RESEARCH PAPER: FISCAL SOLVENCY ASSIGNMENT INSTRUCTIONS OVERVIEW 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-page 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
PADM 702
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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 include a minimum of 5 sources, not including
the course textbooks, assigned readings, and the Bible.
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