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i am a little confused as to how i should round my figures in calculations especially NPV calculations, sometimes i see answers rounding to the $000, then i see them rounding to 2 decimal places etc..
i wondering which you think is the best way to round off figures.
Thank You..
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Hi,
I can’t really generalize here – you need to look at the context of the question and the way the question is set and then with some forethought make this judgment yourself.
One other point, sometimes rounding will not be material to the outcome but other times rounding can affect or distort your ability to make a decision from the outcome, if the rounding is too sweeping in the first place.- so be careful
See if this works for you:
Why not practice rounding millions to $000’s and $000’s to say 2 decimal places.Regards, Kevin
thank you so much, that’s actually why i asked..
i realised that when working out practice questions, when i used a different measurement of rounding, the answers were materially different…
its kinda scary to lose significant marks for using poor judgment in rounding!will try my very best, again thank you..
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