Extrapolation and Financial instrument: Difference between pages

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# A straight-line estimation method where the estimated result lies beyond the range spanned by two or more known data points.
A security or other contract giving the holder of the financial instrument a claim on another party.
# More generally, any estimation method where the estimated result lies beyond the range spanned by two or more known data points.  (Not necessarily using straight-line methods of estimation.)


::Extrapolation is generally a less reliable estimation method than Interpolation.
IAS 32 defines a financial instrument as any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.


::Extrapolation can be particularly unreliable when historical trends - for example historic growth rates - are projected into future periods for planning purposes.
== See also ==
* [[Equity instrument]]
* [[Financial asset]]
* [[Financial liability]]
* [[Financial markets]]
* [[IAS 32]]
* [[Security]]


== See also ==
* [[Approximation]]
* [[Interpolation]]

Revision as of 14:19, 23 October 2012

A security or other contract giving the holder of the financial instrument a claim on another party.

IAS 32 defines a financial instrument as any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

See also