What factors can influence your investment choices?
What factors can influence your investment choices?
Summary – Investment levels are influenced by:
- Interest rates (the cost of borrowing)
- Economic growth (changes in demand)
- Confidence/expectations.
- Technological developments (productivity of capital)
- Availability of finance from banks.
- Others (depreciation, wage costs, inflation, government policy)
How easily an investment can be exchanged for cash is known as?
How easily an investment can be exchanged for cash is known as diversification.
What is best short term investment?
Best investments for short-term money
| When you need the money | Investment options |
|---|---|
| A year or less | Savings and money market accounts, cash management accounts |
| Two to three years | Treasurys and bond funds, CDs |
| Three to five years (or more) | CDs, bonds and bond funds, and even stocks for longer periods |
How do you determine your liquid net worth?
You can determine your liquid net worth by taking the total sum of your liabilities and subtracting that from the total sum of your liquid assets. However, some liquid assets may come with a liquidity discount, so you’ll want to factor this into equation when calculating your final liquid net worth.
Is a car an investment asset?
Your car may be considered an asset because you can sell it for a large amount of money. This can help in emergency situations and may help you to get out from underneath the loan. But your car is not an investment. It depreciates over time.
Why cars are a terrible investment?
Seriously. Cars are depreciating assets, meaning they lose value over time. New cars are the worst. That’s because the biggest depreciation comes in the first year, with a big chunk of that coming when you drive it away and it goes from new to used.
What assets can you depreciate?
Depreciable Property
- Depreciable property is any asset that is eligible for tax and accounting purposes to book depreciation in accordance with the Internal Revenue Service (IRS) rules.
- Property, plant, and equipment (PP&E) are depreciable assets, as are certain intangible property such as patents, copyrights, and computer software.
What is the lease payment on a $50 000 car?
You want the $50,000 car and have negotiated the price down to $45,000. It will be worth $30,000 at the end of the lease, so your lease cost, before interest, taxes, and fees, will be $15,000 divided into equal monthly payments. If you put $2,000 down, the amount you make payments on drops to $13,000.
