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5. In this order of ideas, we come to the realization that having money now is more valuable than having it in the future as, through time, money has the ability to multiply, if wisely invested.
Q11 -- Cash Budgeting The depression and recession stages are the least prosperous ones and in each case, the intent is that of surviving until the economy picks up again. There is a general misconception that recession and depression are synonyms, which is however not the case. As an old economists' joke would say, recession is when the neighbor loses their job and depression is when I lose my job. A recession occurs when the national gross domestic product has sustained decreases for two consecutive years or when the business activity, which had reached its peak, begins to decline; it generally lasts for one year. A depression however occurs as a result of a sustained depression, from which the economy has difficulties reviving (Moffatt, 2009).
Cash budgeting is a complex process, with a simple definition however. It sees that organizational managers conduct an analysis and estimation of the cash which is expected to enter and leave the organization. The process refers to "an estimation of the cash inflows and outflows for a business or individual for a specific period of time. Cash budgets are often used to assess whether the entity has sufficient cash to fulfill regular operations and/or whether too much cash is being left in unproductive capacities" (Investopedia, 2009). This process is not only useful, but it is also necessary as it has the ability to sustain the economic agent in reaching his goals. For instance, cash budgeting has the ability to estimate the actual worth and costs of an investment and reveals as such whether or not the company should invest its financial resources in the respective investment opportunity.
Q12 -- Depression and Recession Phases of a Business Cycle
References:
Moffatt, M., 2009, Recession? Depression? What is the Difference? About, http://economics.about.com/cs/businesscycles/a/depressions.htm last accessed on August 27, 2009
2009, Cash Budget, Investopedia, http://www.investopedia.com/terms/c/cashbudget.asp last accessed on August 27, 2009
This will attract more customers leading to more profits in the organization. In addition, this will create customer loyalty and the company will have a competitive advantage over its rival. Conclusion In conclusion, it is true that Brocade is a successful company. This is due to its increased realization of profits over the last few years. This is evidence from its financial statements including income statements, balance sheet as well as
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