DECA FINANCE EXAM STUDY GUIDE

debtor-creditor relationship - Answers -A debtor is someone who owes a financial

obligation (a "debt") to another, known as the creditor. Interest must be charged.

affinity fraud - Answers -- Affinity fraud refers to investment scams that prey upon

members of identifiable groups, such as religious or ethnic communities, the elderly, or

professional groups.

- The fraudsters who promote affinity scams frequently are - or pretend to be - members

of the group.

- Many affinity scams involve Ponzi or Pyramid schemes

phishing - Answers -the fraudulent practice of sending emails purporting to be from

reputable companies in order to induce individuals to reveal personal information, such

as passwords and credit card numbers.

Types of communication (up and downward and lateral) - Answers -- Upward: process

of information flowing from the lower levels of a hierarchy to the upper levels

- Downward: occurs when information and messages flow down through an

organization's formal chain of command or hierarchical structure. In other words,

messages and orders start at the upper levels of the organizational hierarchy and move

down toward the bottom levels.

- Lateral/Horizontal: the exchange, imparting or sharing of information, ideas or feeling

between people within a community, peer groups, departments or units of an

organization who are at or about the same hierarchical level as each other for the

purpose of coordinating activities, efforts or fulfilling a common purpose or goal.

economic resources - Answers -Economic resources are the goods or services

available to individuals and businesses used to produce valuable consumer products.

Include land, labor, capital, and entrepreneurship, also known as factors of production.

convergence ratio - Answers -the measure of a company's ability to meet its financial

obligations. In broad terms, the higher the coverage ratio, the better the ability of the

enterprise to fulfill its obligations to its lenders.

financial consolidation - Answers -the process of combining financial data from several

departments or business entities within an organization, usually for reporting purposes.

Data Mining - Answers -- the practice of examining large databases in order to

generate new information. (the process of automated extraction of hidden, previously

unknown and potentially useful information from large databases.)

- Includes artificial neutral networks, decision trees, dashboards, nearest-neighbor

method

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debtor-creditor relationship - Answers - A debtor is someone who owes a financial obligation (a "debt") to another, known as the creditor. Interest must be charged. affinity fraud - Answers -- Affinity fraud refers to investment scams that prey upon members of identifiable groups, such as religious or ethnic communities, the elderly, or professional groups.

The fraudsters who promote affinity scams frequently are - or pretend to be - members of the group.
Many affinity scams involve Ponzi or Pyramid schemes phishing - Answers - the fraudulent practice of sending emails purporting to be from reputable companies in order to induce individuals to reveal personal information, such as passwords and credit card numbers. Types of communication (up and downward and lateral) - Answers -- Upward: process of information flowing from the lower levels of a hierarchy to the upper levels
Downward: occurs when information and messages flow down through an organization's formal chain of command or hierarchical structure. In other words, messages and orders start at the upper levels of the organizational hierarchy and move down toward the bottom levels.
Lateral/Horizontal: the exchange, imparting or sharing of information, ideas or feeling between people within a community, peer groups, departments or units of an organization who are at or about the same hierarchical level as each other for the purpose of coordinating activities, efforts or fulfilling a common purpose or goal. economic resources - Answers - Economic resources are the goods or services available to individuals and businesses used to produce valuable consumer products. Include land, labor, capital, and entrepreneurship, also known as factors of production. convergence ratio - Answers - the measure of a company's ability to meet its financial obligations. In broad terms, the higher the coverage ratio, the better the ability of the enterprise to fulfill its obligations to its lenders. financial consolidation - Answers - the process of combining financial data from several departments or business entities within an organization, usually for reporting purposes. Data Mining - Answers -- the practice of examining large databases in order to generate new information. (the process of automated extraction of hidden, previously unknown and potentially useful information from large databases.)
Includes artificial neutral networks, decision trees, dashboards, nearest-neighbor method

Artificial Neutral Networks - Answers - Set up in a similar way to neurons in our brain. We use a digital computer to run a simulation of a bunch of heavily interconnected little mini-programs which stand in for the neurons of our simulated neural network. Decision Trees - Answers - a decision support tool that uses a tree-like graph or model of decisions and their possible consequences, including chance event outcomes, resource costs, and utility. It is one way to display an algorithm. Dashboards - Answers - a user interface that, somewhat resembling an automobile's dashboard, organizes and presents information in a way that is easy to read. Nearest Neighbor Method - Answers - a prediction technique that is quite similar to clustering - its essence is that in order to predict what a prediction value is in one record look for records with similar predictor values in the historical database and use the prediction value from the record that it "nearest" to the unclassified record. Industry forecasting - Answers - Forecasting is the use of historic data to determine the direction of future trends. Businesses utilize forecasting to determine how to allocate their budgets or plan for anticipated expenses for an upcoming period of time. This is typically based on the projected demand for the goods and services they offer. operating agreement - Answers - an agreement among limited liability company members governing the LLC's business, and members' financial and managerial rights and duties. profit-loss statement - Answers - financial statement that summarizes the revenues, costs and expenses incurred during a specific period of time cost standard - Answers - the practice of substituting an expected cost for an actual cost in the accounting records, and then periodically recording variances showing the difference between the expected and actual costs. Used to save time balanced scorecard - Answers - a strategic planning and management system that is used extensively in business and industry, government, and nonprofit organizations worldwide to align business activities to the vision and strategy of the organization, improve internal and external communications, and monitor organization performance against strategic goals. query - Answers - a question, especially one addressed to an official or organization, especially in order to express one's doubts about it or to check its validity or accuracy. Includes select, data-definition, crosstab, pass-through. Select query - Answers - One of the easiest to use and can be used to select and display data from either one table or a series of them depending on what is needed.

murder, intimidation, and the use of physical force against witnesses, law enforcement officers or court officials. breach of contract - Answers - a legal cause of action in which a binding agreement or bargained-for exchange is not honored by one or more of the parties to the contract by non-performance or interference with the other party's performance. substantiation - Answers - to establish by proof or competent evidence: trade - Answers - involves the transfer of goods and/or services from one person or entity to another, often in exchange for money. A network that allows trade is called a market. contract - Answers - a voluntary arrangement between two or more parties that is enforceable by law as a binding legal agreement. Contract is a branch of the law of obligations in jurisdictions of the civil law tradition. antitrust law - Answers - a collection of federal and state government laws that regulates the conduct and organization of business corporations, generally to promote fair competition for the benefit of consumers. property law - Answers -- The area of law that governs the various forms of ownership and tenancy in real property and in personal property, within the common law legal system.

In the civil law system, there is a division between movable and immovable property. tax deduction vs. tax deferred - Answers -- Tax deduction: a reduction of income that is able to be taxed, and is commonly a result of expenses, particularly those incurred to produce additional income.
Tax deferred: refers to investment earnings such as interest, dividends or capital gains that accumulate tax free until the investor takes constructive receipt of the gains. format of business letter - Answers -- Your address, also known as the "return address", should come first. And should be placed on the left-hand side if you're using full block format otherwise on the right-hand side if you're using modified block format
Directly beneath your address, put the date on which the letter was written
Beneath the date, you should put the name and address of the person you're writing to, just as it would appear on the envelope.
After their address, you should leave a line's space then put "Dear Mr Jones", "Dear Bob" or "Dear Sir/Madam" as appropriate. Follow this with a colon, and it should always be left-aligned
The main body of your letter should have single-spacing between lines and a blank line (NOT an indent) before each new paragraph.
The closing should be left-aligned for full block format or on the right for modified block format

Put several blank lines (room for you to sign your name) after the "Yours sincerely," (if you know the person) or "Yours faithfully," (if you don't know the person) then type your name. Your name and signature should be left-aligned for full block format or on the right for modified block format collection letter - Answers - Written notification of the pending amounts, meant to prod past-due customers to make a payment. They are sent usually one after another, with the tone and language getting more direct with each successive letter, until at least some payment is received. Also called dunning letter. cause and effect of inflation - Answers - increase in inflation causes a decrease in purchasing power why check credit history - Answers - to avoid being denied credit mortgage compnay - Answers - often just the originator of a loan; it markets itself to potential borrowers and seeks funding from one of several client financial institutions that provide the capital for the mortgage itself. credit union - Answers - a nonprofit-making money cooperative whose members can borrow from pooled deposits at low interest rates. insurance company - Answers - pools clients' risks to make payments more affordable for the insured. Insurance is a contract, represented by a policy, in which an individual or entity receives financial protection or reimbursement against losses from an insurance company. CPA firm - Answers - a firm that is licensed in the state in which they operate and owned, at least in part by a Certified Public Accountant, are comprised of auditors who conduct both public and private audit engagements. money market - Answers - the trade in short-term loans between banks and other financial institutions. treasury bills - Answers - a short-dated government security, yielding no interest but issued at a discount on its redemption price. herd behavior (on investors) - Answers - describes how individuals in a group can act collectively without centralized direction. financial information management - Answers - The basic objective of the financial information system is to meet the firm's financial obligations as they come due, using the minimal amount of financial resources consistent with an established margin of safety.

Sets standards for financial information about businesses that are traded on a stock exchange
has 5 commissions
appointed by president, confirmed by senate
5 year term Transmittal Letter - Answers - A letter that lets the recipient know exactly what should be contained in a package and if the recipient needs to take any action. Claim Letter - Answers - Requests a solution to a problem Acknowledgement Letter - Answers - Acknowledges the receipt of business papers. Request Letter - Answers - Asks for information. Matrix Organizational Structure - Answers - A combination of the functional structure and the divisional structure. Includes traditional departments, but is also broken down by division. It is a relatively new organizational structure. Deposit-Taking Financial Institutions - Answers - Accepts funds from customers and pay interest on the funds. e.g. credits unions, savings and loan associations, commercial banks. Commodities Investors - Answers - Invests their funds in goods such as grains, livestock, raw materials, etc. Stock Table - Answers - Typically includes the 52-week high and low, the stock symbol, the estimated dividend per share, the yield percentage/rate of return, the volume/sales for the day, the closing price for the day, the net change and the price-earnings ratio Vertical Analysis - Answers - Calculates each individual item on a financial statement as a percentage of the total to develop common size financial statements that allow him/her to compare performance across several years for a single company or across several different companies Horizontal Analysis - Answers - Analyzes dollar amounts on financial statements for a single company across several years Consumer Marketing - Answers - Emphasis on promotion and advertising Business Marketing - Answers - Emphasis on personal selling Underwriter - Answers - Responsible for calculating the risk of loss, establishing premium rates, and designing policies to cover risk. Very important to the insurance industry.

Convenience Product - Answers - A type of good that is purchased often by a consumer without involving much exertion or consideration. Shopping product - Answers - A higher end product occasionally bought by consumers that are usually compared for their appropriateness, quality, cost and features before purchase occurs. Consumers tend to take more time when purchasing a shopping good produced by a business, and they might even travel to buy such goods. Capital product - Answers - tangible assets such as buildings, machinery, equipment, vehicles and tools that an organization uses to produce goods or services in order to produce consumer goods and goods for other businesses. Specialty Product - Answers - a product that certain consumers will actively seek to purchase because of unique characteristics or loyalty to a specific brand. Consumers who seek specialty products know what they want and will spend the time and effort to get it. Joint venture - Answers - a commercial enterprise undertaken jointly by two or more parties that otherwise retain their distinct identities. Wholly owned subsidiary - Answers - a company that is completely owned by another company. The company that owns the subsidiary is called the parent company or holding company. The parent company will hold all of the subsidiary's common stock. Franchise - Answers - an authorization granted by a government or company to an individual or group enabling them to carry out specified commercial activities, e.g., providing a broadcasting service or acting as an agent for a company's products. Independent Trade Intermediary - Answers - Middle men, third parties Procedural law - Answers - comprises the rules by which a court hears and determines what happens in civil, lawsuit, criminal or administrative proceedings. Statutory law - Answers - define written laws, usually enacted by a legislative body. They vary from regulatory or administrative laws that are passed by executive agencies, and common law, or the law created by prior court decisions. ... A bill is proposed in the legislature and voted upon. Commercial law - Answers - also known as business law or corporate law, is the body of law that applies to the rights, relations, and conduct of persons and businesses engaged in commerce, merchandising, trade, and sales. It is often considered to be a branch of civil law and deals with issues of both private law and public law. Administrative law - Answers - the body of law that regulates the operation and procedures of government agencies.

DECA FINANCE EXAM STUDY GUIDE, Exams of Social Sciences

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DECA FINANCE EXAM STUDY GUIDE