Econometric Model – A Tool in Financial Management

Abstract

The economic situation in Romania requires from the trader a rigorous analysis of vulnerabilities and opportunities offered by the external environment and a careful analysis of internal environmental conditions in which the entity operates. In this context particular attention is paid to indicators presented in the financial statements. Many times they are a model for economic forecasts, future plans, basic business and businesses that use them with a good forecasting activity. In this paper we propose to analyze the comparative evolution of the main financial indicators highlighted in financial statements (profit and loss) through a multi-equation econometric model, namely dynamic Keynesian model.

Keywords

• Financial management
• Econometric model
• Instrument