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Unit 7: Fundamental Analysis 1: Economic Analysis

7. An …………………….. in government spending stimulates the demand for goods and Notes
services.
8. …………………….. policy is concerned with the manipulation of money supply in the
economy.
9. Monetary policy affects the economy mainly through its impact on ………………….. rates.
10. …………………….. is very simple method through which investors can form their opinion/
expectations with respect to the future state of the economy.
11. In …………………….. approach, various types of indicators are studied to find out how the
economy is likely to behave in future.
12. …………………….. indicators lead the economic activity in their outcome. That is, these
are those time series data of the variables that reach their high points as well low points in
advance of the economic activity.
13. …………………….. are time series data of variables that lag behind in their consequences
vis-à-vis the economy. That is, these reach their turning points after economy has already
reached its own.
14. …………………….. Index combines several indicators into one single measure, in order to
measure the strength or weakness in the movements of these particular time series of
data.

15. …………………………..Evaluation Index is a narrow type of index, one that examines a
particular series taking into consideration its components. It measures the breadth of the
movement within a particular series.

Case Study Deciding on Critical Gas Infrastructure Investments

ur client faced several competing options to upgrade their gas infrastructure
facilities. However, decision-making lacked urgency, with our client uncertain
Oof the proposals’ impact on uptime and total business costs. The process had
reached a stalemate. SBC was engaged to independently assess the options from HSE,
business risk, and cost perspectives.
Evaluating True Cost of Investment and Delay
Our first step was to demonstrate asset criticality and raise the sense of urgency among
client stakeholders. Having analyzed the asset’s piping integrity; we revealed just how
close the asset was to undergoing a significant drop in reliability and the potential business
risks of continued non-compliance. We also calculated the financial costs and impact on
oil production any inevitable shutdown would have.

Our second step was to evaluate alternative approaches to meeting future needs of the
asset, concluding that an ‘all at once’ approach would be far more successful than a piecemeal
one. We assessed and compared the two best options to improve the asset’s gas
infrastructure, which were both still at the client’s concept selection stage. We made
recommendations based on our analysis of many factors including:
Base cost

Risk
Contd...

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