Research Paper: Fiscal Solvency

Research Paper: Fiscal Solvency Assignment Instructions

Overview

Fiscal Solvency is the ability of a governmental entity to meet its long-term debts and financial obligations. Solvency can be an important measure of financial health, since its one way of demonstrating a government’s ability to manage its operations into the foreseeable future. The quickest way to assess a government’s solvency is by checking fiscal solvency ratios.

Fiscal solvency ratios are a key metric used to measure a government’s ability to meet its debt obligations and is used often by prospective lenders. The solvency ratio indicates whether a company’s cash flow is sufficient to meet its short-and long-term liabilities. There is a difference between solvency and liquidity.  Solvency is a long-term measure, while Liquidity is a short-term measure.  Liquidity relates more to short-term cash flow, while solvency relates more to long-term financial stability. Simply put, liquidity is the value of all its assets. Solvency ratios are used to examine the ability of a government to meet its long-term obligations. The ratios are most used by current and prospective lenders. The ratio compares an approximation of cash flows to liabilities and is derived from the following ratios: (1) Current Ratio, (2) Operating Ratio, and (3) Net Asset Ratio.

Instructions

To successfully complete this assignment, please refer to the assignment resource: Research Paper: Fiscal Solvency Assignment Guide.

For this Assignment, you will need to compute, and create tables to analyze:

1)      Current Ratio

2)      Operating Ratio

3)      Net Asset Ratio

Then, using the tables and charts, you will write an 8-10 double-spaced research paper analyzing:

1)      The degree of solvency of Bay City, Texas

2)      Solvency methods and techniques and why they are important for governments to use and their advantages and disadvantages.

3)      How Solvency Helps Financial Issues

4)      Solvency vs Liquidity

This is a Doctoral-level research assignment designed to test your ability to carefully research, effectively organize, and concisely communicate a nuanced understanding of the concepts and issues raised in the assignment. While the minimum page limit is short (as is often the case in public policy/public administration briefings), you are expected to craft efficient, highly substantive papers. You are expected to comport with the highest writing, research, and ethical standards. Additionally, to do well on this assignment, you must conduct high-quality research and offer rich, well-supported analysis; mere opinion or conjecture will not suffice. There must be no careless or simple grammatical errors such as misspellings, incomplete sentences, comma splices, instances of faulty noun/verb agreement, etc. Such errors will result in significant point deductions.

The text of this research paper must be 8-10 pages (not including title page, reference page, and any appendices). This paper must be in current APA format with 1-inch margins and 12-pt Times New Roman font. You must also include a title page and reference page. You must include citations to a sufficient number of appropriate professional, scholarly, or other appropriate sources to fully support your assertions and conclusions (which will likely require more than the minimum number of citations); each paper must contain citations to the course texts book, assigned readings, and a minimum of 5 additional sources not including the course textbooks, assigned readings, and the Bible. Feel free to use the internet as for other sources if the sources are credible.

Plagiarism in any form is strictly prohibited and may result in failure of the assignment, failure of the course, and/or removal from the program. It is your responsibility to ensure that you fully understand what constitutes the various forms of plagiarism and to avoid all forms of plagiarism.

Note: Your assignment will be checked for originality via the Turnitin plagiarism tool.

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