Overview
People should understand the impact of different types of risk on financial health, whether they’re dealing with personal or corporate finances. The risks for personal finance often only affect individuals and families. These risks come up, for example, when deciding whether you can afford to buy a house or invest in stocks. Financial risks for businesses often affect multiple people throughout the entire company. This includes individuals who do not work in the finance department. When businesses make finance-related decisions, it’s important that they know how their decisions affect all parts of their company.
Prompt
Read the Assessing a Company’s Future Financial Health case study. Then write a response.
Specifically, you must address the following rubric criteria:
- Systematic and Unsystematic Risk: Explain the differences between systematic and unsystematic risk.
- Financial Risks: Describe the potential impacts of the following types of financial risk on the company featured in the case study:
- Interest rate risk
- Economic risk
- Credit risk
- Operational risk
- Lower Growth Impact: Explain the impact that a lower growth in sales could have on the dividend policy and retained earnings for the company described in the case study.
- Higher Growth Impact: Explain the impact that a higher growth in sales could have on the dividend policy and retained earnings for the company described in the case study.
What to Submit
Your submission should be a 2- to 3-page Word document with 12-point Times New Roman font, double spacing, and one-inch margins. Sources should be cited according to APA style.
| Criteria | Exemplary (100%) | Proficient (85%) | Needs Improvement (55%) | Not Evident (0%) | Value |
|---|---|---|---|---|---|
| Systematic and Unsystematic Risk | Exceeds proficiency in an exceptionally clear, insightful, sophisticated, or creative manner | Explains the differences between systematic and unsystematic risk | Shows progress toward proficiency, but with errors or omissions; areas for improvement may include explaining in more detail the differences between systematic and unsystematic risk | Does not attempt criterion | 20 |
| Financial Risks | Exceeds proficiency in an exceptionally clear, insightful, sophisticated, or creative manner | Describes the potential impacts of interest rate risk, economic risk, credit risk, and operational risk on the company featured in the case study | Shows progress toward proficiency, but with errors or omissions; areas for improvement may include describing in more detail the potential impacts of interest rate risk, economic risk, credit risk, and operational risk on the company featured in the case study | Does not attempt criterion | 21 |
| Lower Growth Impact | Exceeds proficiency in an exceptionally clear, insightful, sophisticated, or creative manner | Explains the impact that a lower growth in sales could have on the dividend policy and retained earnings for the company described in the case study | Shows progress toward proficiency, but with errors or omissions; areas for improvement may include explaining in more detail the impact that a lower growth in sales could have on the dividend policy and retained earnings for the company described in the case study | Does not attempt criterion | 22 |
| Higher Growth Impact | Exceeds proficiency in an exceptionally clear, insightful, sophisticated, or creative manner | Explains the impact that a higher growth in sales could have on the dividend policy and retained earnings for the company described in the case study | Shows progress toward proficiency, but with errors or omissions; areas for improvement may include explaining in more detail the impact that a higher growth in sales could have on the dividend policy and retained earnings for the company described in the case study | Does not attempt criterion | 22 |
| Articulation of Response | Exceeds proficiency in an exceptionally clear, insightful, sophisticated, or creative manner | Clearly conveys meaning with correct grammar, sentence structure, and spelling, demonstrating an understanding of audience and purpose | Shows progress toward proficiency, but with errors in grammar, sentence structure, and spelling, negatively impacting readability | Submission has critical errors in grammar, sentence structure, and spelling, preventing understanding of ideas | 10 |
| Citations and Attributions | Uses citations for ideas requiring attribution, with few or no minor errors | Uses citations for ideas requiring attribution, with consistent minor errors | Uses citations for ideas requiring attribution, with major errors | Does not use citations for ideas requiring attribution | 5 |
| Total: | 100% |
