05. Modelling the financial case

Lecture quiz

Quiz - Modelling the financial case

Developing Bankable Climate Finance Proposals. Unlimited attempts, no timer, and one pass mark for the whole platform - applied the same way to the 2 written questions below the multiple choice.

4 questionsPass mark 70%No results recorded+ 2 written questions

Questions

4

70% to pass

Attempts

-

no figures in this prototype

Pass rate

-

no figures yet

Average score

-

no figures yet

Questions

The correct answer and its explanation are shown together here so you can check them at a glance - neither is ever shown to a learner attempting the quiz, right or wrong.

  1. 1. In project finance terms, where should risk generally sit?

    • With the party that has the deepest balance sheet
    • With the party best able to manage itCorrect
    • Always with the public sector
    • Wherever the funder prefers

    Demand risk placed on a contractor who cannot influence demand is priced heavily or refused; retained by the party that can manage it, it often costs far less.

  2. 2. Why include a downside case in a financial model?

    • It is a mandatory annex in every template
    • Appraisers will find it anyway, and naming it builds credibilityCorrect
    • It lowers the interest rate offered
    • It transfers liability to the funder

    Stating the point at which a project stops being viable is a signal of a model worth trusting on everything else.

  3. 3. What makes a project 'bankable' rather than simply worthwhile?

    • It has government backing
    • It produces a measurable return or saving a funder can point toCorrect
    • It is technically innovative
    • It has no environmental impact

    A project can be entirely worth doing and still not be bankable if nothing about it produces a measurable return a funder can point to.

  4. 4. A revenue-generating project pitched only for grant funding is making what mistake?

    • Asking for too much money
    • Wasting the strongest thing the project hasCorrect
    • Underestimating construction costs
    • Ignoring the climate rationale

    Matching the finance type to a project's actual cash flow is decided before the proposal is drafted - a revenue-generating project belongs with a different source.

Written questions

Optional - a lecture is complete without any. Add two-to-three sentence explanation questions where the multiple-choice quiz cannot tell whether an idea actually landed - as soon as one exists, a learner must pass it at 70%, the same platform-wide mark as the quiz, before the next lecture opens.

  1. 1. In two or three sentences: why is a financial model only useful if someone else can follow it?

    followassumptionvisiblecheck

    2 of 4 have to appear to pass.

    Model answer: A financial model's purpose is to let someone else follow and check the reasoning behind it. Keeping every assumption visible on one sheet, rather than buried in a formula, is what makes a model evidence.

  2. 2. In two or three sentences: why does showing a project's downside case build trust rather than weaken the proposal?

    downsidefailsviabletrust

    2 of 4 have to appear to pass.

    Model answer: Appraisers trust a proposal that names the conditions under which it fails. Stating the point a project stops being viable earns more trust than withholding the downside case, because an appraiser will find it anyway.