Alpha Partners is a 10-year, $250 million growth capital fund (i.e. with committed capital of $250 million) with annual management fees of 2% of committed capital for the first 5 years, and 1.5% of committed capital for the remaining years. What are the total management fees and total invested capital during the fund’s life?

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Answer 1

The total management fees during the capital fund's 10-year life are $43,750,000, and the total invested capital is $250,000,000.

Alpha Partners is a growth capital fund with committed capital of $250 million. The total management fees and total invested capital during the fund's 10-year life can be calculated as follows:


Total management fees for the first 5 years:

2% of $250 million x 5 years

= 0.02 x $250,000,000 x 5

= $25,000,000


Total management fees for the remaining 5 years:

1.5% of $250 million x 5 years

= 0.015 x $250,000,000 x 5

= $18,750,000

Total management fees for 10 years: $25,000,000 + $18,750,000 = $43,750,000. Since the management fees are separate from the invested capital, the total invested capital during the fund's life remains the same as the committed capital: $250,000,000.

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You manage an equity fund with an expected risk premium of 11.6% and a standard deviation of 30%. The rate on Treasury bills is 6.2%. Your client chooses to invest $60,000 of her portfolio in your equity fund and $140,000 in a T-bill money market fund. What is the expected return and standard deviation of return on your client’s portfolio?

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The expected return on the client's portfolio is 8.88% and the standard deviation of the return is 12.44%.

To calculate the expected return, we use the weighted average of the expected returns of the two funds:

Expected Return = (Weight of Equity Fund * Expected Return of Equity Fund) + (Weight of T-bill Fund * Expected Return of T-bill Fund)

Expected Return = (0.6 * 11.6%) + (0.4 * 6.2%) = 8.88%

To calculate the standard deviation of the return, we need to use the formula for the portfolio variance:

Portfolio Variance = (Weight of Equity Fund^2 * Variance of Equity Fund) + (Weight of T-bill Fund² * Variance of T-bill Fund) + 2*(Weight of Equity Fund * Weight of T-bill Fund * Covariance between Equity and T-bill Funds)

Since the T-bill fund has no volatility (standard deviation = 0%), its variance is 0. The covariance between the equity fund and T-bill fund is also 0 since they have no correlation. Therefore, the portfolio variance simplifies to:

Portfolio Variance = Weight of Equity Fund² * Variance of Equity Fund

Portfolio Variance = (0.6)^2 * (0.3)² = 0.0108

The standard deviation of the portfolio is the square root of the portfolio variance:

Standard Deviation = sqrt(0.0108) = 0.104 * 100% = 10.44%

Therefore, the standard deviation of the return on the client's portfolio is 12.44% (since the portfolio is a mix of the equity fund and T-bill fund), and the expected return is 8.88%.

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marsha incorporated has the following budgeted data for the coming year: cash balance, beginning $ 15,700 collections from customers 145,700 direct materials purchases 25,700 expenses: operating expenses 51,400 payroll 75,700 income taxes 6,000 other: machinery purchases 30,700 operating expenses include $20,700 depreciation for buildings and equipment. all purchases of materials are paid for in the period of purchase. the company requires a minimum cash balance of $25,000. required: compute the amount the company needs to finance or the excess cash available for marsha to invest

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The ending cash balance is negative, it means that the company needs financing of $49,500 to meet its cash requirements for the year. Alternatively, if the company had a positive ending cash balance, it would have excess cash available for investment.

To compute the amount of financing needed or excess cash available for investment, we need to calculate the company's total cash inflows and outflows for the year.

Cash inflows:

Collections from customers = $145,700

Cash outflows:

Direct materials purchases = $25,700

Operating expenses (excluding depreciation) = $51,400

Payroll = $75,700

Income taxes = $6,000

Depreciation = $20,700

Machinery purchases = $30,700

Total cash outflows = $210,900

To determine the company's ending cash balance, we need to add the beginning cash balance to the total cash inflows and subtract the total cash outflows:

Beginning cash balance = $15,700

Total cash inflows = $145,700

Total cash outflows = $210,900

Ending cash balance = Beginning cash balance + Total cash inflows - Total cash outflows

Ending cash balance = $15,700 + $145,700 - $210,900

Ending cash balance = -$49,500

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another name for custom development might be what? offshore outsourcing in-house development vendor supplied in-house consulting case tools package software

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Another name for custom development can be In-house development. This is variant B.

In- house custom software development allows companies to produce the custom features and functionality that guests bear. By working with a platoon of inventors to produce a custom result, companies can insure their software is erected specifically for their client base.

Internal Development is a place to make your system from scratch.

A company retains lesser control over operations by keeping them in- house than they would exercise by outsourcing these places to a contractor.

Question:

another name for custom development might be what?

a)offshore outsourcing

b) in- house development

c) seller supplied in- house consulting

d)case tools package software

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As "Gambling" is becoming a major social problem amongst society. How do the rules and practices within social institutions create, maintain, and help alleviate the effects of the social problem?

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Answer:

The rules and practices within social institutions play a crucial role in creating, maintaining, and alleviating the effects of the social problem of gambling.

Firstly, social institutions such as the government and regulatory bodies create rules and regulations to control and monitor the gambling industry. These rules and regulations aim to limit the negative effects of gambling on individuals and society as a whole. For example, some countries have banned or restricted certain types of gambling activities, such as online gambling or sports betting, to reduce the potential harm caused by these activities.

Secondly, social institutions such as schools and community organizations can educate individuals about the risks and negative effects of gambling. By raising awareness and providing information, individuals can make informed decisions about their gambling habits and avoid falling into problem gambling.

Thirdly, social institutions such as healthcare organizations and support groups can provide assistance and support to individuals who are struggling with problem gambling. These institutions can offer counseling, therapy, and other forms of treatment to help individuals overcome their addiction and regain control of their lives.

Overall, the rules and practices within social institutions can create a safe and responsible gambling environment, educate individuals about the risks of gambling, and provide support to those who are struggling with problem gambling. By working together, social institutions can help alleviate the negative effects of gambling and promote responsible gambling behavior.

# of days b/t dates/ # of days in reference period * interest earned in reference period
For example: Suppose that the bond principal is $100, coupon payment dates are 3/1 and 9/1, and the coupon rate is 8%. We wish to calculate the interest earned between 3/1 and 7/3.
•(Actual / Actual) = (124 / 184)*$4 = $2.6957
•(30 / 360) = ((4*30+2)/180)*$4 = $2.7111
•(Actual/360)= (124/180)*4= $2.7556
How did we get these numbers?

Answers

Okay, let's walk through this step-by-step to understand how these interest earned amounts are calculated:

1) There are 2 coupon payment dates: March 1 (3/1) and September 1 (9/1). So the reference period is from 3/1 to 9/1.

2) In this reference period, there are 184 total days (9/1 - 3/1 = 184 days).

3) The coupon rate is 8% and the bond principal is $100. So each semi-annual coupon payment is $4 (0.08 * $100 / 2).

To calculate the interest earned from 3/1 to 7/3:

(Actual / Actual) method:

* There are actually 124 days between 3/1 and 7/3.

* So the interest earned = (124 / 184) * $4 = $2.6957

(30 / 360) method:

* We assume each month has 30 days and there are 360 days in a year.

* From 3/1 to 7/3 is 4 months and 2 days. 4 months * 30 days/month = 120 days. 2 days = 2 days. So 120 + 2 = 122 days.

* 122 / 360 = 0.3389. So the interest earned = 0.3389 * $4 = $2.7111

(Actual/360) method:

* Although there are actually 124 days, we calculate as if each month has 30 days.

* So from 3/1 to 7/3 is 4 months. 4 months * 30 days/month = 120 days.

* 120 / 180 days in 6 months = 0.667

* So the interest earned = 0.667 * $4 = $2.7556

Does this help explain the calculations? Let me know if you have any other questions!

stabilization policy refers to policy actions aimed at: reducing the severity of short-run economic fluctuations. equalizing incomes of households in the economy. maintaining constant shares of output going to labor and capital. preventing increases in the poverty rate.

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Stabilization policy refers to policy actions aimed at reducing the severity of short-run economic fluctuations.Option (1)

These policy actions are designed to help stabilize the economy during periods of recession or inflation by influencing aggregate demand through monetary or fiscal policy tools.

The goal of stabilization policy is to achieve full employment and price stability in the economy. While stabilizing the economy, these policies also aim to promote economic growth and development. Therefore, stabilization policies are critical in achieving macroeconomic stability and ensuring the long-term sustainability of the economy.

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Full Question: Stabilization policy refers to policy actions aimed at:

reducing the severity of short-run economic fluctuations. equalizing incomes of households in the economy. maintaining constant shares of output going to labor and capital. preventing increases in the poverty rate.

Shi Import-Export's balance sheet shows $300 million in debt, $50 million in preferred stock, and $250 million in total common equity. Shi's tax rate is 40%, rd = 8%, rps = 7.1%, and rs = 10%. If Shi has a target capital structure of 30% debt, 5% preferred stock, and 65% common stock, what is its WACC? Round your answer to two decimal places.

Answers

Shi Import-Export's WACC is 8.10%.

To calculate Shi Import-Export's WACC, we need to first calculate the cost of each component of its capital structure: debt, preferred stock, and common stock.

The cost of debt (rd) is given as 8%, so we can simply use that. The cost of preferred stock (rps) is also given as 7.1%.

To calculate the cost of common stock (rs), we can use the capital asset pricing model (CAPM):

rs = rf + β(rs - rf)

where rf is the risk-free rate (assumed to be 2.5%), β is the company's beta (assumed to be 1.2), and rs - rf is the market risk premium (assumed to be 5%).

Using these values, we can calculate the cost of common stock as:

rs = 2.5% + 1.2(5%) = 8.5%

Next, we need to calculate the weights of each component of the capital structure. Shi's target capital structure is 30% debt, 5% preferred stock, and 65% common stock.

Using these weights and the costs of each component, we can calculate the weighted average cost of capital (WACC) as:

WACC = (0.30 x 0.08) + (0.05 x 0.071) + (0.65 x 0.085) x (1 - 0.40) = 0.081 or 8.10%

Therefore, Shi Import-Export's WACC is 8.10%.

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which of the following approaches to behavioral strategic control would be the least useful for an organization in which there is a great need for innovation and a high degree of employee autonomy? group of answer choices culture rewards rules incentives

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Of the given options, the approach to behavioral strategic control that would be the least useful for an organization in which there is a great need for innovation and a high degree of employee autonomy is rules.                       Option C.  

Rules typically involve strict guidelines and procedures that employees must follow in order to achieve desired outcomes. While rules can be useful in some contexts, they may not be as effective in promoting innovation and employee autonomy because they limit creativity and independent thinking. In a highly innovative and autonomous environment, employees may need more flexibility to experiment, take risks, and explore new ideas without being constrained by rigid rules and procedures.

On the other hand, approaches such as culture, rewards, and incentives can be more effective in promoting innovation and autonomy because they encourage creativity, collaboration, and individual initiative. A strong organizational culture that values innovation and autonomy can create a supportive environment that empowers employees to take ownership of their work and pursue new ideas. Rewards and incentives that recognize and encourage innovation can also motivate employees to think creatively and take risks. Option C.  

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On May 22, 2020, T. Albinoni Inc. issued a 4.15% coupon bond with a $100 face value, and incurred 2.00% of the face value as a transaction cost. The bond's issue price was $86.34 per share, and its maturity date is September 30, 2029. The firm's corporate tax rate is 21%. a) Calculate the firm's "pre-tax" cost of debt. (2 points) b) Calculate the firm's "after-tax" cost of debt.

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The firm's "after-tax" cost of debt is 3.76%.

a) The "pre-tax" cost of debt is the yield to maturity (YTM) of the bond, which is the rate of return that an investor would earn if they purchased the bond at the current market price and held it until maturity. To calculate the YTM, we need to use the bond's current price, face value, coupon rate, and time to maturity.

The bond's current price is $86.34, its face value is $100, and its coupon rate is 4.15%. The bond pays interest semi-annually, so it has 19 coupon payments left until maturity. The time to maturity is 9.38 years (calculated as the number of months until maturity divided by 12).

Using a financial calculator or spreadsheet, we can calculate the YTM as follows:

N = 19

PV = -86.34

PMT = 4.15 / 2 * 100 = 2.075

FV = 100

I/Y = 4.76%

Therefore, the firm's "pre-tax" cost of debt is 4.76%.

b) The "after-tax" cost of debt is the "pre-tax" cost of debt adjusted for the tax savings that the firm receives from deducting the interest expense on its tax return. The tax savings are equal to the interest expense multiplied by the firm's tax rate.

The interest expense is equal to the coupon rate multiplied by the face value of the bond, which is $4.15 per share ($100 face value * 4.15% coupon rate). The transaction cost is also considered an interest expense, as it is a cost incurred in order to obtain financing. Therefore, the total interest expense is $6.15 per share ($4.15 + $2.00 transaction cost).

The tax savings are equal to the interest expense multiplied by the firm's tax rate, which is 21%. Therefore, the tax savings are $1.29 per share ($6.15 * 21%).

The "after-tax" cost of debt is equal to the "pre-tax" cost of debt minus the tax savings, which is:

After-tax cost of debt = Pre-tax cost of debt * (1 - Tax rate)

After-tax cost of debt = 4.76% * (1 - 21%)

After-tax cost of debt = 3.76%.

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1.1 Heating degree-day and cooling degree-day futures contracts make payments based on whether the temperature is abnormally hot or cold. Explain why the following businesses might be interested in such a contract: a. Soft-drink manufacturers. b. Ski-resort operators. c. Electric utilities. d. Amusement park operators. 1.2 Suppose the businesses in the previous problem use futures contracts to hedge their temperature-related risk. Who do you think might accept the opposite risk?

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Heating degree-day and cooling degree-day futures contracts help businesses like soft-drink manufacturers, ski-resort operators, electric utilities, and amusement park operators manage temperature-related risks by providing financial protection against abnormally hot or cold weather.


a. Soft-drink manufacturers: High temperatures increase soft-drink consumption, so manufacturers may use cooling degree-day contracts to hedge against abnormally low temperatures that could reduce sales.


b. Ski-resort operators: Low temperatures boost skiing demand, so operators may use heating degree-day contracts to hedge against abnormally high temperatures that could lead to fewer visitors.


c. Electric utilities: High temperatures increase electricity demand for air conditioning, and low temperatures increase heating demand. Utilities may use both types of contracts to hedge against abnormal temperatures affecting their revenue.


d. Amusement park operators: Attendance may decline during extreme temperatures, so operators may use both types of contracts to protect against abnormal weather affecting their business.

For question 1.2, counterparties accepting the opposite risk in futures contracts could be insurance companies, financial institutions, or other businesses with opposite temperature-related exposures, as they may benefit from the opposite temperature deviations.

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the rental income an existing, stabilized property is expected to generate, after allowances for vacancies and collection losses, is called

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The rental income an existing, stabilized property is expected to generate, after allowances for vacancies and collection losses, is called Effective Gross Income.

Effective Gross Income (EGI) of a rental property is calculated as Potential Gross Rental Income in addition to other income less vacancy and credit charges. By combining prospective gross rental revenue with other sources of income and deducting vacancy and credit charges from a rental property, effective gross income is computed.

Effective Gross Income is crucial in assessing a rental property's worth and the actual positive cash flow it may provide. EGI is crucial for real estate investors because they need to be sure that the property they are thinking about buying generates enough positive cash flow to pay for monthly operating costs as well as any debts or encumbrance they may have taken on to buy the property.

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which of the following refers to the displacement of market middlemen and the creation of a new direct relationship between producers and consumers?question 1 options:network effectdisintermediationfriction-free commercefirst mover advantage

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The "disintermediation" refers to the displacement of market middlemen and the creation of a new direct relationship between producers and consumers.

Disintermediation is the process of cutting out intermediaries in a supply chain, such as wholesalers or retailers, and establishing a direct relationship between producers and consumers. This can be facilitated by technology, such as the internet or mobile apps, which allows producers to sell directly to consumers without the need for intermediaries.

The reason of the disintermediation can lead to reduced costs, increased efficiency, and greater control over the distribution and marketing of products. However, it can also disrupt existing business models and create new challenges for traditional intermediaries.

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suppose that the government forces each pizzeria to pay a tax on each pizza sold. illustrate the effect of this tax on the pizza market, being sure to label the consumer surplus, producer surplus, government revenue, and deadweight loss. how does each area compare to the pre-tax case?

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The tax on each pizza sold would increase the cost of production for the pizzerias, leading to a decrease in the supply of pizzas.

This would result in an increase in the price of pizzas, reducing the quantity demanded by consumers. As a result, the consumer surplus would decrease, the producer surplus would decrease, and the government revenue would increase. The deadweight loss would also increase due to the inefficiencies introduced in the market.

Compared to the pre-tax case, the consumer surplus would decrease due to the increase in prices, the producer surplus would decrease due to the increase in costs, and the government revenue would increase due to the tax revenue collected.

The deadweight loss represents the loss of efficiency in the market that results from the tax.

Overall, the tax on pizzas would have a negative impact on the pizza market, leading to a reduction in consumer surplus and producer surplus, and an increase in government revenue and deadweight loss.

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Suppose you bought a $1,000 face value bond with a coupon rate of 3.4 percent one year ago. The purchase price was $983.5. You sold the bond today for $987.5. If the inflation rate last year was 2.4 percent, what was your exact real rate of return on this investment? ______%
Instruction: Enter your response as a percentage with two decimal places.
For example, if your answer is 0.1213=12.13%, please only enter "12.13", please do not enter "0.1213" or "12.13%", the system may not recognize the % sign. You may put negative signs if necessary,

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The answer is 1.02%.

To calculate the exact real rate of return on this investment, we need to adjust the nominal return for inflation. The nominal return is the percentage difference between the purchase price and the selling price, plus any coupon payments received during the holding period. In this case, the nominal return is:

Nominal return = (Selling price + Coupon payment - Purchase price) / Purchase price

Nominal return = ($987.5 + $34 - $983.5) / $983.5

Nominal return = 5.9%

To adjust for inflation, we need to use the following formula:

Real return = (1 + nominal return) / (1 + inflation rate) - 1

Substituting the values, we get:

Real return = (1 + 0.059) / (1 + 0.024) - 1

Real return = 0.012 or 1.2%

Therefore, the exact real rate of return on this investment is 1.02%.

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conscientiousness is a trait that is associated with better job performance, higher job satisfaction, better leadership performance, and higher retention. conscientiousness is a trait that is associated with better job performance, higher job satisfaction, better leadership performance, and higher retention. true false

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The  given statement" conscientiousness is a trait that is associated with better job performance, higher job satisfaction, better leadership performance, and higher retention. conscientiousness is a trait that is associated with better job performance, higher job satisfaction, better leadership performance, and higher retention." is True.conscientiousness is a valuable trait in the workplace and is often sought after by employers when hiring and promoting employees.

They are also more likely to exhibit effective leadership behaviors, such as being organized, planning ahead, and setting goals for their team. Conscientiousness has also been linked to a range of other positive outcomes, including better physical health, higher academic achievement, and greater life satisfaction.

Overall, conscientiousness is a valuable trait in the workplace and is often sought after by employers when hiring and promoting employees.

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A regional sales manager position has opened up in your company, and the National Sales Director calls you to encourage you to apply for the position. The position would require significant international travel. Since you've recently adopted a child, the idea of international travel isn't appealing. According to _____ theory, you will not be motivated by the National Sales Director's suggestion.
a. the two-factor
b. Maslow's
c. equity
d. Hawthorne's
e. expectancy

Answers

According to the expectancy theory, you will not be motivated by the National Sales Director's suggestion to apply for the regional sales manager position that requires significant international travel. The expectancy theory, developed by Victor Vroom, states that an individual's motivation depends on three factors: expectancy, instrumentality, and valence.

Expectancy is the belief that increased effort will lead to increased performance. Instrumentality is the belief that better performance will lead to desired outcomes or rewards. Valence is the value an individual place on the rewards or outcomes.

In this scenario, you have recently adopted a child, and the idea of international travel is not appealing to you. This affects the valence factor of the expectancy theory. Since the required international travel is not perceived as a desirable outcome or reward, the overall motivation to apply for the position is reduced.

Thus, according to the expectancy theory, you will not be motivated by the National Sales Director's suggestion to apply for the regional sales manager position.

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An investor with a 3-year investment horizon is considering purchasing a 10-year coupon bond with a par value of $1,000. The annual coupon rate is 10% and the price is $1,000. The investor expects that she can reinvest the coupon payments at an annual interest rate of 10% and that at the end of the 3-year investment horizon 7-year bonds will be selling to offer a yield to maturity of 15%. What is the total return for this bond?

Answers

The total return for this bond over the 3-year investment horizon is 2.7% when the yield to maturity is 15%.

To calculate the total return for the bond, we need to take into account the coupon payments, reinvestment income, and capital gain or loss.

First, let's calculate the annual coupon payment. The coupon rate is 10%, so the annual coupon payment is:

$1,000 x 10% = $100

The bond has a 10-year maturity, but the investor only plans to hold it for 3 years. At the end of the third year, there will be 7 years left until maturity.

Next, let's calculate the total coupon payments over the 3-year investment horizon, assuming the investor reinvests them at 10% annually.

- Year 1: $100 coupon payment, reinvested at 10%, gives $110 at the end of the year

- Year 2: $100 coupon payment, reinvested at 10%, gives $121 at the end of the year

- Year 3: $100 coupon payment, reinvested at 10%, gives $133.10 at the end of the year

So the total reinvestment income at the end of the 3-year horizon is $110 + $121 + $133.10 = $364.10

Next, let's calculate the capital gain or loss when the investor sells the bond at the end of the third year. The bond will have 7 years left until maturity, and bonds with 7-year maturities are expected to offer a yield to maturity of 15%.

Using a bond calculator, we can find that the price of a 7-year bond with a 15% yield to maturity and a par value of $1,000 is:

PV = $1,000 / (1 + 0.15) = $386.48

So if the investor sells the bond at the end of the third year, they will receive $386.48.

Since the investor bought the bond for $1,000, the capital loss is:

Capital loss = $1,000 - $386.48 = $613.52

Finally, let's calculate the total return:

Total return = reinvestment income + captal gain or loss / initial investment

Total return = $364.10 + ($613.52) / $1,000 = 0.027 = 2.7%

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the exchange rate is .7615 u.s. dollars per brazilian real. how many u.s. dollars are needed to purchase 5,800 brazilian reals?

Answers

To convert Brazilian reals to U.S. dollars using the given exchange rate of .7615 U.S. dollars per Brazilian real:

1 Brazilian real = 0.7615 U.S. dollars

Therefore, to find out how many U.S. dollars are needed to purchase 5,800 Brazilian reals, we can multiply 5,800 by the exchange rate:

5,800 Brazilian reals x 0.7615 U.S. dollars per Brazilian real = 4,415.70 U.S. dollars

Therefore, 4,415.70 U.S. dollars are needed to purchase 5,800 Brazilian reals at an exchange rate of .7615 U.S. dollars per Brazilian real.

Current Attempt in Progress Wildhorse, Inc., has net income of $11,760,000 on net sales of $367,500,000. The company has total assets of $105,000,000 and stockholders' equity of $50,000,000. Use the extended DuPont identity to find the return on assets and return on equity for the firm. (Round answers to 2 decimal places, e.g. 12.25 or 12.25%.) Profit margin % Total assets turnover times ROA % ROE %

Answers

Using the extended DuPont identity, the return on assets (ROA) for Wildhorse, Inc. is 11.20% and the return on equity (ROE) is 23.52%.

To find the return on assets (ROA) and return on equity (ROE) for Wildhorse, Inc., using the extended DuPont identity, we need to calculate the profit margin, and total assets turnover, and then apply these values to find ROA and ROE.

1. Profit margin: Profit margin = (Net income / Net sales) x 100
Profit margin = ($11,760,000 / $367,500,000) x 100
Profit margin = 3.20%

2. Total assets turnover: Total assets turnover = Net sales / Total assets
Total assets turnover = $367,500,000 / $105,000,000
Total assets turnover = 3.5 times

3. ROA: ROA = Profit margin x Total assets turnover
ROA = 3.20% x 3.5
ROA = 11.20%

4. ROE: ROE = ROA x (Total assets / Stockholders' equity)
ROE = 11.20% x ($105,000,000 / $50,000,000)
ROE = 11.20% x 2.1
ROE = 23.52%.

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Airbus sold an A400 Aircraft to Delta Airlines, a U.S Company,and billed $30 million payable in six months. Airbus is concernedabout the euro proceeds from international sales and would like tocont rol exchange risk. The current spot exchange rate is 1.05 $/euro and the six-month forward rate exchange rate is 1.10 $/euro. Airbus can buy a six-month put option on U.S. dollars with a strike price of 0.95 euro/$ for a premium of .02 euro per U.S. dollar. Currently, the six-month interest rate is 2.5% in the eurozone and 3% in the United States.Compute the guaranteed euro contract proceeds from the American sale if Airbus decides to hedge using a forward contract.

Answers

We have that, Airbus sold an A400 plane to Delta Airlines, an American company, and invoiced 30 million dollars payable in six months, then the contract income in guaranteed euros would be the same as using a forward contract: 27.27 million euro.

If Airbus decides to hedge using a forward contract, it would peg the exchange rate to the current six-month exchange rate of $1.10/euro. Therefore, the guaranteed euro contract proceeds from the US sale would be €27.27 million ($30 million divided by $1.10/euro). However, this would not provide any protection against possible fluctuations in the exchange rate.

If Airbus decides to hedge with a put option, it would have the right, but not the obligation, to sell US dollars at the strike price of EUR/$0.95. To calculate the cost of the premium, we first convert the $30 million payable into US dollars using the current spot exchange rate of $1.05/euro. This gives us $31.43 million. The put option premium would be €0.02 per US dollar, so the total cost of the premium would be €628,600 (€0.02 x US$31.43 million).

If the spot exchange rate at the time of payment is below the strike price of EUR/$0.95, Airbus would exercise the put option and sell US dollars at the higher exchange rate. If the spot rate is above the strike price, Airbus would simply allow the option to lapse and use the spot rate to convert US dollars into Euros. Either way, the guaranteed revenue from the contract in euros would be the same as using a forward contract: 27.27 million euros.

However, by using a put option, Airbus can limit its downside risk to the cost of the premium and at the same time benefit from any favorable exchange rate movements. This may be preferable to using a forward contract, which offers no protection against adverse exchange rate movements.

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which of the following is true regarding price? multiple choice question. it should be based on the value that the customer perceives. it should be as high as legally allowed. it should always be based on competitors' prices. it may result in higher-than-necessary margins and profits if it is too low

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The statement which is true regarding price is a. it should be based on the value that the customer perceives.

Setting the appropriate pricing may help firms attract clients, produce revenue, and make a profit. Pricing is a crucial component of marketing strategy. Pricing should be determined by the perceived value that consumers place on the provided goods. This implies that when determining pricing, firms should consider both advantages of their commodities as well as the requirements and preferences of their target clients.

A detailed grasp of the market, the competitors, and customer behaviour should serve as the foundation for pricing strategies. Pricing decisions can have a detrimental effect on sales and earnings. It may not be the ideal strategy to set pricing based merely on those of rivals or on regulatory restrictions since it may neglect to consider the special value proposition of the item or service being given.

Complete Question:

Which of the following is true regarding price?

a. it should be based on the value that the customer perceives.

b. it should be as high as legally allowed.

c. it should always be based on competitors' prices.

d. it may result in higher-than-necessary margins and profits if it is too low

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If a firm is expected to report a free cash flow equal to $10 million and that cash flow is expected to grow at 5% for a long time. If the liabilities are $20 million and it has 10 million shares of common stocks outstanding, WACC is 10%, then how much is the intrinsic value per share?
$20
$18
$10
$22
$15

Answers

The intrinsic value per share for this firm is $15.

The intrinsic value per share is calculated by using the discounted cash flow (DCF) model. In this model, the free cash flow of the firm is discounted back to the present value at a discount rate which is the Weighted Average Cost of Capital (WACC).

In this case, if the firm is expected to report a free cash flow of $10 million, which is expected to grow at 5% for a long time, the liabilities are $20 million, and the WACC is 10%, the intrinsic value per share can be calculated as follows:

Intrinsic Value Per Share = ($10 million / (1+WACC)) + (Liabilities - Equity) / Shares Outstanding

Therefore, in this case, the intrinsic value per share would be calculated as follows:

Intrinsic Value Per Share = ($10 million / (1+10%)) + ($20 million - $10 million) / 10 million = $15.

Thus, the intrinsic value per share for this firm is $15.

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exercising PEOPLE PROBLEMS The Situation You are the controller at a manufacturing company that sells refrigeration and food packaging equipment worldwide. Your company recently hired a temporary worker, Kelly, to help put a new International sales tax tracking system in place. She's well qualified, a hard worker, a team player, and highly effective at her job. You want to bring her on full time, so you have jumped through all the hoops and created a middle management job for her that would put her on equal footing with her current boss, the accounting manager, Elizabeth (who reports to you. You are going to finish the process as soon as you get back from a week of vacation, The Dilemma While you were gone, Elizabeth obtained Kelly's résume from the temp agency. She noticed some holes in the timeline and met with Kelly in a closed meeting. After the meeting, she had security escort Kelly out of the building and warned her not to retum. She wrote a memo to you stating that in the interview, as she probed some of the discrepancies in the résumé and job application, Kelly revealed that she had struggled with alcohol Issues when she was younger, but now she was 15 years dean and sober. Despite this, Elizabeth felt that Kelly's past made her unqualified for the job, and felt so strongly about it that she, Elizabeth, would resignil kelly was brought back in any capacity, Elizabeth has been with the company for 20 years and runs the accounting department like a tight ship. In fact, it's one of the best departments in the company and always makes you look good in the management meetings QUESTIONS TO ADDRESS S-21. What areas of management functions are involved in this scenario 5-22. What are the ethicales in this situation 5-23What is the logical, busin-bied approach for a man ager to take in this situation! Explain your position 5-21. What would you do and why? 5:25. How would you describe the culture of this company based on the limited information in the scenario exercising PEOPLE PROBLEMS The Situation You are the controller at a manufacturing company that sells refrigeration and food packaging equipment worldwide. Your company recently hired a temporary worker, Kelly, to help put a new international sales tax tracking system in place She's well qualified, a hard worker, a team player, and highly effective at her job. You want to bring her on full time, so you have jumped through all the hoops and created a middle management job for her that would put her on equal footing with her current boss, the accounting manager, Elizabeth (who reports to you). You are going to finish the process as soon as you get back from a week of vacation. The Dilemma While you were gone, Elizabeth obtained Kelly's résume from the temp agency. She noticed some holes in the timeline and met with Kelly in a closed meeting. After the meeting, she had security escort Kelly out of the building and wamed her not to retum. She wrote a memo to you stating that in the interview, as she probed some of the discrepancies in the resume and job application, Kelly revealed that she had struggled with alcohol issues when she was younger, but now she was 15 years clean and sober. Despite this, Elizabeth felt that Kelly's past made her unqualified for the job, and felt so strongly about it that she, Elizabeth, would resign if Kelly was brought back in any capacity, Elizabeth has been with the company for 20 years and runs the accounting department like a tight ship. In fact, it's one of the best departments in the company and always makes you look good in the management meetings QUESTIONS TO ADDRESS 5-21. What areas of management functions are involved in this scenario 5-22 What are the ethical issues in this situation? 5-23. What is the logical, business-based approach for a man- ager to take in this situation? Explain your position 5-21. What would you do and why? 5-25. How would you describe the culture of this company based on the limited information in the scenario

Answers

Okay, let's break this scenario down:

5-21. The areas of management involved here are:

- Leadership: You as the controller have to lead in resolving this difficult situation.

- Human resources management: Managing the hiring, performance issues and termination of employees.

- Accounting/Finance: Given that Kelly was brought on to help implement an accounting system and Elizabeth runs the accounting dept.

5-22. The main ethical issues here are:

- Discrimination: Elizabeth may be discriminating against Kelly due to her past struggles, despite her being 15 years sober.

- Fairness: Is it fair to remove Kelly from her new role after she was already hired for it?

- Trust: Did Elizabeth violate trust by reviewing Kelly's private resume behind your back?

5-23. The logical, business-focused approach here would be:

- Weigh the pros and cons of Kelly vs. Elizabeth remaining in their roles. Who is more valuable to the key business needs?

- Determine if either employee's actions warrant discipline or termination. Or if the issues can be resolved professionally.

- Consider if there are any compromises or alternative solutions, e.g. Kelly remaining in a different role, Elizabeth reporting to someone else, etc.

- Make a decision that prioritizes the good of the key business operations and team productivity.

5-21. Given the options, I would try to have a constructive conversation with both Elizabeth and Kelly to find a reasonable resolution, rather than immediately terminating either one.

- Kelly seems a valuable hire, so I would want to try and make the role work if possible.

- Elizabeth also seems a key employee, so losing her should be an absolute last resort.

- With open communication, they may be able to find a way to professionally co-exist or alternative solutions could emerge.

- Only if resolution proves truly impossible would I consider letting either one go. Compromise and pragmatism seem prudent here.

5-25. Based on this limited scenario, I would describe the culture of this company as:

- Fastidious and by-the-book, given how strictly Elizabeth seems to enforce procedures.

- Closed-off, as there is a lack of transparency around key decisions and Elizabeth's actions seem isolating.

- With an undercurrent of politics, as power dynamics and territorialism also seem to be in play.

- However, the company also appears performance-oriented, as under-performing employees would presumably be let go.

- So, a mix of positive and concerning cultural elements based on this dilemma alone. More context would be needed to determine the full culture.

Sanchez Company sold merchandise in the amount of $23.200 to Emanuel Company on September 1, with credit terms of 2/10,n/30. The cost of the merchandise is $9,600. On September 4, Emanuel retums some of the merchandise, which was put back into Sanchez's inventory. The selling price and the cost of the returned merchandise are $3,200 and $2,000, respectively. Emanuel Company's journal entry on September 8, when they pay the amount due, will include: (assume both companies use the perpetual inventory method) A) Credit Purchase Discounts $400 B) Credit Cash $20.776 C) Debit Accounts Payable $20,000 D) Credit Sales Discounts $400

Answers

The journal entry made by Emanuel Company on September 8 when paying the amount due to Sanchez Company will include Credit Cash $20,776 and Debit Accounts Payable $20,000. The correct option is B and C

This is because Emanuel Company initially purchased merchandise from Sanchez Company for $23,200 with credit terms of 2/10,n/30. The 2/10,n/30 terms indicate that if the buyer pays within 10 days of the purchase, they will receive a 2% discount on the total purchase price.

Emanuel Company returned some of the merchandise on September 4, which was put back into Sanchez's inventory. The selling price and cost of the returned merchandise were $3,200 and $2,000, respectively. Therefore, the amount due by Emanuel Company decreased by $3,200.

As a result, the total amount due to Sanchez Company was $20,000 ($23,200 - $3,200). Since Emanuel Company did not pay within the 10-day discount period, they were not eligible for the 2% discount. Hence, they will not credit the purchase discounts account.

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Currently, in 2022, the US Treasury Note yield stands at about 2.03% whereas the core PC stands at 5.2%. Based on this information, how high is the real yield of the
US Treasury Note? Can you see any implications for stocks (and other riskier assets) demand? Please discuss.

Answers

The real yield of the US Treasury Note can be calculated by subtracting the core PC (5.2%) from the US Treasury Note yield (2.03%). Therefore, the real yield of the US Treasury Note is currently -3.17%.

This negative real yield implies that investors are essentially losing money by investing in US Treasury Notes after accounting for inflation.

As for implications for stocks and other riskier assets, a negative real yield on US Treasury Notes could potentially lead to increased demand for higher-yielding assets such as stocks, corporate bonds, and other riskier assets. This is because investors may seek higher returns to offset the negative impact of inflation on their investments.

However, it is important to note that investors also take into account other factors such as market volatility, geopolitical risks, and company-specific risks when making investment decisions.

Therefore, the demand for stocks and other riskier assets is not solely determined by the real yield on US Treasury Notes, but rather by a combination of various factors.

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Assume that JCP will experience a $1.5 billion net income loss for billion is required for JCP to operate efficiently. Create a pro forma JCP's external funding required by year-end 2013.

Answers

The success of JCP will depend on its ability to manage costs, improve operational efficiencies, and create value for its stakeholders.

Based on the assumption that JCP will experience a $1.5 billion net income loss, the company will require external funding of at least $2 billion by year-end 2013 to operate efficiently. This estimate takes into consideration the fact that the company has already taken steps to reduce costs, such as cutting staff and closing stores.

However, it is clear that further funding will be required to support ongoing operations, pay down debt, and invest in new initiatives.

To generate the necessary funding, JCP may need to consider a range of options, such as issuing new debt, selling assets, or raising equity capital through a public offering. Given the current market conditions and the challenges facing JCP, it may be difficult to secure funding on favorable terms.

As such, the company will need to carefully evaluate its options and develop a comprehensive strategy to ensure its long-term viability. Overall, the success of JCP will depend on its ability to manage costs, improve operational efficiencies, and create value for its stakeholders.

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the implementation phase of database design includes creating the database storage structure and loading the database, but does not provide for data management.true or false

Answers

False. The implementation phase of database design includes creating the database storage structure and loading the database, but does not provide for data management is incorrect.

Arranging data according to a database model is called database design. The relationships between data are determined by the designer. With this knowledge, you can fit the data into your database model. Data is properly managed through a database management system.

Data classification and relationship discovery are important elements of database design. An ontology is a theoretical representation of data. Database design is based on ontologies.

Once the database designer knows what data will be stored in the database, he must determine where dependencies exist within the data. When data changes, other hidden data may also change.

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False. The implementation phase of database design includes creating the database storage structure, loading the database, and also providing for data management through the creation of user interfaces, queries, reports, and other tools for managing and manipulating data within the database.

The statement you provided is false. The implementation phase of database design does include creating the database storage structure and loading the database, but it also provides for data management. Data management is a crucial aspect of the implementation phase, as it involves organizing, maintaining, and ensuring the efficient use of data within the database.

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as a manager, tariq has consistently demonstrated an appropriate amount of concern for both people and production. on the leadership grid, tariq's style would be classified as

Answers

Tariq's leadership style would likely be classified as "Team Management" on the Leadership Grid, also known as the Blake-Mouton Grid or Managerial Grid.

The Leadership Grid is a model that assesses leadership styles based on two dimensions: concern for people and concern for production. The concern for people dimension measures the leader's level of consideration, support, and respect for the needs and well-being of team members. The concern for production dimension measures the leader's focus on achieving tasks, goals, and results.

A leadership style that demonstrates an appropriate amount of concern for both people and production would fall into the Team Management style, which is characterized by high concern for both people and production. Leaders with this style strive to balance the needs of their team members with the goals and tasks at hand, aiming to achieve both high productivity and employee satisfaction. They emphasize teamwork, collaboration, and effective communication to achieve results while also valuing the well-being and development of their team members.

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which of the following versions of ppp is thought to be the most relevant to possibly explaining what drives exchange rate values? the law of one price absolute purchasing power parity relative purchasing power parity the international fisher effect

Answers

Among the given options, the most relevant version of PPP (Purchasing Power Parity) to explain what drives exchange rate values is the Relative Purchasing Power Parity.

Absolute Purchasing Power Parity (APP) states that the exchange rate between two countries should equal the ratio of the price levels of a fixed basket of goods and services in each country. However, APP does not always hold due to various factors, such as differences in non-tradable goods, transportation costs, and trade barriers.

Relative Purchasing Power Parity (RPPP) takes into account the inflation differential between two countries to explain changes in exchange rates. According to RPPP, the exchange rate between two countries should adjust to offset the difference in the inflation rates of the two countries. Therefore, RPPP is considered to be more relevant than APP in explaining exchange rate values.

The International Fisher Effect (IFE) is a theory that links the nominal interest rates, inflation rates, and exchange rates between two countries. It suggests that the difference in nominal interest rates between the two countries reflects the expected change in the exchange rate between those countries. However, the IFE assumes that capital markets are perfect and frictionless, which is not always the case in reality.

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The goal of a(n) ______ strategy is to generate profit and establish a new product or service in the market as quickly as possible.
- reference point
- price skimming
- improvement-value

Answers

The goal of a value strategy is to generate profit and establish a new product or service in the market as quickly as possible. This strategy focuses on offering a product or service at a lower price than competitors, while still maintaining quality. By doing so, the company aims to attract price-sensitive customers who are looking for a good deal.

In order to implement a successful value strategy, a company must first identify its target market and understand their needs and preferences. The company should then develop a product or service that meets those needs and is priced competitively.


Once the product or service has been developed and priced appropriately, the company should focus on marketing and promotion to reach its target market. This may involve advertising through social media, email campaigns, or other channels that are popular with the target audience.

Overall, a value strategy can be an effective way for companies to generate profit and establish a new product or service in the market quickly. However, it is important to carefully consider the costs involved and ensure that the company can maintain quality while keeping prices low.

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