One disadvantage of the functional structure is that D. communication can be difficult among organizational functions
In a functional structure, employees are grouped based on their specialized skills and expertise, such as finance, marketing, or operations. This grouping allows for efficiency within each department, as tasks are completed by experts in their respective fields.
However, this structure may lead to communication challenges between different functions, as each department becomes focused on its objectives and goals. This can create silos, making it difficult for departments to effectively collaborate and share information. Consequently, the organization may struggle to address cross-functional issues or achieve broader objectives.
In summary, the functional structure can result in communication difficulties among organizational functions, which may impede collaboration, hinder innovation, and make it challenging for the organization to achieve its overall goals. Therefore the correct option is D.
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The following question pertains to the relationship between the equity multiplier (EM), the debt ratio (DR), and the debt-equity ratio (DE)
Which is true
A. If DR and DE both equal one, the EM must equal one
B. If DR and DE both equal zero, the EM cannot equal one
C. A company's DR and DE can never both be equal to 0.5
D. If DR is 0.5, DE will be 1 and EM will be 2
D is true because if DR is 0.5, DE will be 1 and EM will be 2.
The equity multiplier (EM) is a measure of financial leverage, which is the ratio of debt to equity used to finance a company's assets. It is calculated by dividing total assets by total equity, and it measures the extent to which a company is using debt to finance its operations.
The debt ratio (DR) is the ratio of total debt to total assets, while the debt-equity ratio (DE) is the ratio of total debt to total equity.
A is not true because although DR and DE may both equal one, the EM could be greater than one depending on the amount of assets in the company.
B is not true because if DR and DE both equal zero, the EM would still be greater than one because total assets are greater than total equity. C is not true because a company's DR and DE can both be equal to 0.5, in which case the EM would be equal to one.
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The psychological and social difficulties known as reverse culture shock occur when they are sent to live and work in a highly different and challenging foreign culture Select one True or false
The statement "The psychological and social difficulties known as reverse culture shock occur when they are sent to live and work in a highly different and challenging foreign culture" is false because reverse culture shock occurs when individuals return to their home culture after living in a foreign culture, not when they are sent to live and work in a highly different and challenging foreign culture.
Reverse culture shock refers to the psychological and social difficulties that individuals experience when they return to their home culture after living in a foreign culture for a significant period of time. When people live and work in a foreign culture, they undergo a process of cultural adaptation, where they adjust to the new environment, values, behaviors, and customs.
After adapting to a foreign culture, returning to one's home culture can create a sense of disorientation, confusion, and discomfort as individuals struggle to reintegrate into their own culture. The challenges of reverse culture shock can include feelings of isolation, identity issues, loss of friendships or social networks, and difficulty readjusting to the cultural norms and values of the home country.
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Reverse culture shock refers to the psychological and social difficulties that individuals experience when returning to their home country after living in a foreign culture for an extended period of time. Given statement is False.
This can include feelings of disorientation, frustration, and alienation as they readjust to their old cultural norms and expectations. In contrast, culture shock refers to the initial difficulties and adjustments that individuals experience when first arriving in a new and unfamiliar culture.
Reverse culture shock refers to the psychological and social difficulties that individuals experience when they return to their home culture after living in a foreign culture for a significant period of time. When people live and work in a foreign culture, they undergo a process of cultural adaptation, where they adjust to the new environment, values, behaviors, and customs.
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flexible overhead budget wiki wiki company has determined that the variable overhead rate is $4.50 per direct labor hour in the fabrication department. the normal production capacity for the fabrication department is 10,000 hours for the month. fixed costs are budgeted at $60,000 for the month. question content area a. prepare a monthly factory overhead flexible budget for 9,000, 10,000, and 11,000 hours of production. enter all amounts as positive numbers. wiki wiki company monthly factory overhead cost budget-fabrication department direct labor hours 9,000 10,000 11,000 variable factory overhead cost $fill in the blank 9df91706405eff5 1 $fill in the blank 9df91706405eff5 2 $fill in the blank 9df91706405eff5 3 fixed factory overhead cost fill in the blank 9df91706405eff5 4 fill in the blank 9df91706405eff5 5 fill in the blank 9df91706405eff5 6 total factory overhead cost $fill in the blank 9df91706405eff5 7 $fill in the blank 9df91706405eff5 8 $fill in the blank 9df91706405eff5 9 question content area b. how much overhead would be applied to production if 9,000 hours were used in the department during the month? if required, round your calculations to two decimal places and your final answer to the nearest dollar. $fill in the blank e2a4defc805103f 1
a) The flexible budget is as follows:
Direct Labor Hours: $9,000 | 10,000 | 11,000
Variable Factory Overhead Cost: $40,500 | $45,000 | $49,500
Fixed Factory Overhead Cost: $60,000 | $60,000 | $60,000
Total Factory Overhead Cost: $100,500 | $105,000 | $109,500
b) For content area B, if 9,000 hours were used in the department during the month, the overhead applied to production would be $100,500.
a) To prepare a monthly factory overhead flexible budget for Wiki Wiki Company's fabrication department at 9,000, 10,000, and 11,000 hours of production, follow these steps:
Calculate variable factory overhead costs by multiplying the variable overhead rate ($4.50) by the direct labor hours (9,000, 10,000, and 11,000).
b) Add fixed factory overhead costs, which are budgeted at $60,000 for the month, to each production level.
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Complete question:
wiki wiki company has determined that the variable overhead rate is $4.50 per direct labor hour in the fabrication department. the normal production capacity for the fabrication department is 10,000 hours for the month. fixed costs are budgeted at $60,000 for the month.
question content area
a. prepare a monthly factory overhead flexible budget for 9,000, 10,000, and 11,000 hours of production. enter all amounts as positive numbers.
wiki wiki company
monthly factory overhead cost budget-fabrication department
direct labor hours 9,000 10,000 11,000
variable
factory _______ _______ _______
overhead
cost
fixed
factory _______ _______ _______
overhead
cost
total
factory _______ _______ _______
overhead
cost
b. how much overhead would be applied to production if 9,000 hours were used in the department during the month? if required, round your calculations to two decimal places and your final answer to the nearest dollar. ___________________
A firm plans to issue bonds to finance its expansion. (a) Discuss the agency conflict between the shareholders and the bondholders by relating to any two (2) of such conflicts. (10 marks) (b) Identify two (2) ways to mitigate such conflicts. 10 marks)
When a firm issues bonds to finance its expansion, it creates an agency conflict between the shareholders and the bondholders.
The shareholders and bondholders have different interests, and this may lead to conflicts between them.
One of the conflicts is the risk-taking behavior of shareholders, which increases the probability of the firm defaulting on its bond payments. This conflict arises because shareholders may take risks that benefit them, but negatively affect bondholders.
To mitigate such conflicts, the firm can take several steps. One way is to have proper corporate governance mechanisms, such as a strong board of directors, which ensures that the interests of both shareholders and bondholders are represented.
Another way is to have debt covenants, which restrict the actions of the firm and the shareholders. These covenants may include limitations on dividend payments, restrictions on asset sales, and limits on additional borrowing. Debt covenants serve to protect the bondholders by reducing the risk of default.
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he expected value and the standard deviation of returns for asset A is (See below.) Returns (0) 10 12 16 Asset A Possible Outcomes Probability Pessimistic 0.25 Most likely 0.45 Optimistic 0.30 A. 12.7 percent and 2.3 percent. B. 12 percent and 2.3 percent.
C. 12.7 percent and 4 percent. D. 12 percent and 4 percent.
,The expected value and standard deviation of returns for asset A are 10.55 percent and 6.64 percent, respectively. Answer: A. 10.55 percent and 6.64 percent.
To calculate the expected value, we multiply each possible return by its probability and then sum the products.
Expected Value = (0.25 x 0) + (0.45 x 10) + (0.30 x 16) = 1.25 + 4.5 + 4.8 = 10.55
To calculate the standard deviation, we first need to calculate the variance.
Variance = [(0 - 10.55)² x 0.25] + [(10 - 10.55)² x 0.45] + [(16 - 10.55)² x 0.30]
= 44.06
Standard Deviation = √44.06 = 6.64
Therefore, the expected value and standard deviation of returns for asset A are 10.55 percent and 6.64 percent, respectively.
Answer: A. 10.55 percent and 6.64 percent.
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which of the following is a part of the leadership process? a. motivation and alignment b. organizing and staffing c. controlling and problem solving d. planning and budgeting
Motivation and alignment are key components of the management method, therefore the correct option is A) Motivation
Effective leaders encourage and inspire their group members to work in the direction of a commonplace aim and align their efforts in the direction of achieving the corporation's targets.
Motivation includes know-how what drives individuals and finding methods to encourage and incentivize them to perform at their quality. Alignment involves making sure that everybody is on the identical page and working closer to the equal give up goal, with a shared knowledge of the organization's values and tradition.
A leader's capability to encourage and align their team can have a large impact on the general achievement of the organization, because it facilitates to create a cohesive and high-appearing
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a 10-year maturity mortgage-backed bond is issued. the bond is a zero coupon bond that promises to pay $10,000 (par) after 10 years. at issue, bond market investors require a 15 percent interest rate on the bond. what is the initial price on the bond? multiple choice $10,000 $2,252 $8,696 $2,472
The initial price on the bond can be calculated using the formula for present value of a single future cash flow:
PV = FV / (1 + r)^n,
where PV is the present value,
FV is the future value,
r is the interest rate, and
n is the number of years.
Using the given values, we can plug them into the formula and solve for PV:
PV = 10,000 / (1 + 0.15)^10
PV = 10,000 / 4.046
PV = $2,472
Therefore, the initial price on the bond is $2,472. The answer is (D) $2,472.
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if the capacity for receiving checks is 1000 checks per hour, for sorting checks is 800 checks per hour, and for shipping checks is 1200 per hour, what is the capacity of the system to process checks?
The capacity of the system to process checks would be limited by the slowest process, which is sorting checks at 800 checks per hour. Therefore, the capacity of the system to process checks is 800 checks per hour.
To determine the capacity of the system to process checks when the capacity for receiving checks is 1000 checks per hour, for sorting checks is 800 checks per hour, and for shipping checks is 1200 checks per hour, you need to find the bottleneck in the process.
Step 1: Identify the capacities of each process.
- Receiving checks: 1000 checks/hour
- Sorting checks: 800 checks/hour
- Shipping checks: 1200 checks/hour
Step 2: Find the bottleneck.
The bottleneck is the process with the lowest capacity, which is sorting checks with 800 checks per hour.
Therefore, the capacity of the system to process checks is 800 checks per hour, as it is limited by the bottleneck in the sorting checks process.
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Momentum anomaly violates which form of the EMH.
Momentum anomaly: buying stocks that have performed well in the past 3-12 months (winner) and short selling those that peform poor in the same period (loser) will result in positive abnormal returns.
a. semistrong
b. strong
c.weak
d. None of the options
The momentum anomaly violates the weak form of the Efficient Market Hypothesis (EMH).
The weak form of the EMH assumes that all publicly available information, including historical prices and returns, is already reflected in the current stock price.
This implies that it is impossible to generate abnormal returns by using past stock price information alone, such as the momentum strategy.
However, research has shown that momentum investing can generate positive abnormal returns in the short to medium term, contradicting the weak form of the EMH.
This suggests that past stock price information is not fully reflected in the current stock price, and that investors can potentially profit from exploiting this anomaly.
On the other hand, the semi-strong and strong forms of the EMH assume that all public and private information respectively is already reflected in the current stock price.
Therefore, the momentum anomaly cannot violate these forms of the EMH, as they are already taking into account all available information.
It's important to note that the EMH is a theory and not a law, and there is ongoing debate among academics and practitioners regarding its validity.
While the momentum anomaly appears to contradict the weak form of the EMH, it does not necessarily mean that the
EMH is completely invalid or that all investors can consistently generate abnormal returns by using momentum strategies.
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We are evaluating a project that costs $749,000, has a life of thirteen years, and has no salvage value. Assume that depreciation is straight-line to zero over the life of the project. Sales are projected at 131,000 units per year. Price per unit is $41, variable cost per unit is $27, and fixed costs are $763,231 per year. The tax rate is 24 percent, and we require a return of 13 percent on this project. The projections given for price, quantity, variable costs, and fixed costs are all accurate to within +/- 16 percent. a. Calculate the best-case NPV. Best case __
b. Calculate the worst-case NPV. Worst case __
The Expected Annual Cash Flows are $49,556 to $554,185
a) The best-case NPV is $3,785,601.34.
b) The worst-case NPV is -$953,026.66.
How to calculate the best-case and worst-case NPV?To calculate the best-case and worst-case NPV, we need to first calculate the expected annual cash flows for the project.
Annual Sales Revenue = 131,000 units x $41 = $5,371,000
Annual Variable Costs = 131,000 units x $27 = $3,537,000
Annual Fixed Costs = $763,231
Annual Depreciation = $749,000 / 13 = $57,615
Expected Annual Cash Flows:
Year 1-13: (5,371,000 - 3,537,000 - 763,231 - 57,615) x (1 ± 0.16) - $749,000 / 13 = -$49,556 to $554,185
a. Best-case NPV:
Assuming the best-case scenario where expected cash flows are 16% higher than projected, the expected annual cash flows would be:
Year 1-13: ($5,371,000 - $3,537,000 - $763,231 - $57,615) x (1 + 0.16) - $749,000 / 13 = $554,185
Using the formula for calculating NPV, we get:
NPV = -$749,000 + ∑ [CFt / (1 + r)t]
NPV = -$749,000 + [$554,185 / (1 + 0.13)¹ + $554,185 / (1 + 0.13)² + ... + $554,185 / (1 + 0.13)^13]
NPV = -$749,000 + $4,534,601.34
NPV = $3,785,601.34
Therefore, the best-case NPV is $3,785,601.34.
b. Worst-case NPV:
Assuming the worst-case scenario where expected cash flows are 16% lower than projected, the expected annual cash flows would be:
Year 1-13: ($5,371,000 - $3,537,000 - $763,231 - $57,615) x (1 - 0.16) - $749,000 / 13 = -$49,556
Using the same formula for calculating NPV, we get:
NPV = -$749,000 + ∑ [CFt / (1 + r)t]
NPV = -$749,000 + [-$49,556 / (1 + 0.13)¹ + -$49,556 / (1 + 0.13)² + ... + -$49,556 / (1 + 0.13)^13]
NPV = -$749,000 - $204,026.66
NPV = -$953,026.66
Therefore, the worst-case NPV is -$953,026.66.
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An example of inefficiency arising from mis-allocation of factors among sectors is A. monopoly power of firms B. technology blocking C. free and costless mobility of workers between sectors D. real wage above the marginal product of labor in at least one sector
An example of inefficiency arising from misallocation of factors among sectors is: real wage above the marginal product of labor in at least one sector. The correct option is D
This situation occurs when the compensation paid to workers in a particular sector is higher than the value of their marginal contribution to the production process.
This inefficiency can lead to an imbalance in the allocation of resources, as workers may be incentivized to work in sectors with higher real wages rather than those that would maximize overall economic efficiency and productivity.
In contrast, monopoly power of firms refers to a situation where a single firm or a small group of firms dominates the market, potentially leading to market distortions and inefficiencies.
technology blocking occurs when the adoption of new and more efficient technologies is hindered by factors such as regulatory barriers or resistance from incumbents.
free and costless mobility of workers between sectors is an ideal condition that would promote efficient allocation of labor across sectors, as workers could easily move to the sectors where their skills are most valuable without facing any costs or barriers.
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Complete question:
An example of inefficiency arising from mis-allocation of factors among sectors is:
A. monopoly power of firms
B. technology blocking
C. free and costless mobility of workers between sectors
D. real wage above the marginal product of labor in at least one sector
ABC Corporation has hired you to evaluate a new FOUR year project for the firm. The project will require the purchase of a $786,800.00 work cell. Further, it will cost the firm $51,200.00 to get the work cell delivered and installed. The work cell will be straight-line depreciated to zero with a 20-year useful life. The project will require new employees to be trained at a cost of $51,600.00. The project will also use a piece of equipment the firm already owns. The equipment has been fully depreciated, but has a market value of $5,100.00. Finally, the firm will invest $11,400.00 in net working capital to ensure the project has sufficient resources to be successful. The project will generate annual sales of $911,000.00 with expenses estimated at 40.00% of sales. Net working capital will be held constant throughout the project. The tax rate is 36.00%. The work cell is estimated to have a market value of $482,000.00 at the end of the fourth year. The firm expects to reclaim 84.00% of the final NWC position. The cost of capital is 15.00%. What is the yearly operating cash flow for the project? Submit Answer format: Currency: Round to: 2 decimal places.
The yearly operating cash flow for the project is $127,332.00.
To calculate the yearly operating cash flow for the project, we first need to calculate the initial investment, which is the sum of the cost of the work cell and delivery/installation, the cost of training new employees, the market value of the existing equipment used, and the initial investment in net working capital. So, the initial investment is:
Initial investment = Work cell cost + Delivery/installation cost + Training cost + Market value of existing equipment + Initial NWC investment
Initial investment = $786,800.00 + $51,200.00 + $51,600.00 + $5,100.00 + $11,400.00
Initial investment = $906,100.00
Next, we need to calculate the annual operating cash flow, which is the difference between the annual sales and the annual operating expenses. So, the annual operating cash flow is:
Annual operating cash flow = (Annual sales × (1 - Operating expenses ratio)) - Depreciation
Annual operating cash flow = ($911,000.00 × (1 - 0.40)) - ($786,800.00 ÷ 20)
Annual operating cash flow = $546,600.00 - $39,340.00
Annual operating cash flow = $507,260.00
We will use the straight-line method to calculate the depreciation of the work cell. The annual depreciation expense is the cost of the work cell divided by the useful life.
So, the annual depreciation is:
Annual depreciation = Work cell cost ÷ Useful life
Annual depreciation = $786,800.00 ÷ 20
Annual depreciation = $39,340.00
Finally, we need to calculate the terminal cash flow, which is the sum of the market value of the work cell and the reclaimed net working capital. So, the terminal cash flow is:
Terminal cash flow = Market value of work cell + Reclaimed NWC
Terminal cash flow = $482,000.00 + ($11,400.00 × 0.84)
Terminal cash flow = $491,016.00
Now, we can calculate the yearly operating cash flow using the following formula:
Yearly operating cash flow = Annual operating cash flow + Depreciation - Taxes on depreciation
Yearly operating cash flow = $507,260.00 + $39,340.00 - ($39,340.00 × 0.36)
Yearly operating cash flow = $507,260.00 + $39,340.00 - $14,162.40
Yearly operating cash flow = $532,437.60
Therefore, the yearly operating cash flow is $127,332.00 ($532,437.60 ÷ 4).
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you are the vp of marketing at stauffer foods and you learn that the puddings packaged desserts line from general foods (gf) is available for acquisition. this division produces successful products like pudding pops, instant pudding, and pudding in a cup. you make some of assumptions about this line. which assumption would you not make? purchasing the line would bring established distribution for stauffer foods purchasing the line would bring immediate cash flow for stauffer foods purchasing the line would add equity value to stauffer foods* purchasing the line could create some difficulties in dealing with debt load all would be reasonable assumptions to make*
As the VP of marketing at Stauffer Foods considering the acquisition of General Foods' puddings packaged desserts line, the assumption you would not make is: Purchasing the line would bring immediate cash flow for Stauffer Foods.
This is because acquisitions often require time for integration and alignment with the existing business.
It may take some time to realize the potential cash flow benefits from the acquisition. Other assumptions like established distribution, adding equity value, and potential difficulties in dealing with debt load are all reasonable to consider during this acquisition process.As the VP of Marketing at Stauffer Foods, if I learned that the Puddings Packaged Desserts line from General Foods (GF) was available for acquisition, I would assume that purchasing the line would bring established distribution for Stauffer Foods, purchasing the line would bring immediate cash flow for Stauffer Foods, and purchasing the line would add equity value to Stauffer Foods.These are all reasonable assumptions to make, considering the successful products that the line produces, such as pudding pops, instant pudding, and pudding in a cup. However, the assumption that I would not make is that purchasing the line could create some difficulties in dealing with debt load. Without knowing more about the financials and debt load of both Stauffer Foods and the Puddings Packaged Desserts line, it would be premature to assume that acquiring the line would cause significant difficulties in dealing with debt.
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If a firm shuts down in the short run:
A. its loss is greater than its fixed costs
B. its loss equals its fixed costs
C. total cost equals zero
D. its loss equals zero
E. it makes zero economic profit
F. its loss equals its variable costs
A. its loss is greater than its fixed costs
A firm shutting down in the short run means that the total cost of production is greater than the total revenue earned from the sale of its goods and services. In this case, its loss will be greater than its fixed costs because fixed costs are costs that do not vary with production levels, such as rent and insurance. When production is halted, fixed costs are still incurred.
Variable costs, on the other hand, are costs that vary with production levels, such as materials and labor. When production is halted, variable costs are zero. Therefore, the firm's loss will equal its variable costs. As a result, the firm will make zero economic profit, since economic profit is defined as total revenue minus total cost.
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You are answering questions from your CEO regarding your company’s capital structure and annual financialsa. Assume that your company has bonds with a market rate of return of 10% and equity with a required rate of return of 12%. Why does the debt have a lower required rate of return than the equity? (3 points)b. The company has a rate of return on equity of 9.5% and a rate of return on debt of 7% and rate of return on preferred shares of 7.5%. If the company’s capital structure is 50% equity, 40% debt and 10% preferred shares. Assuming tax on debt = 20%, but no tax on anything else, what is the Weighted Average Cost of Capital (WACC)
a. Debt has a lower required rate of return than equity because it is considered less risky. Bondholders receive a fixed payment (interest) and have priority over equity holders in the event of bankruptcy.
In contrast, equity holders have no guaranteed payment and are last in line for assets in case of liquidation, which makes equity riskier and requires a higher rate of return.
b. The Weighted Average Cost of Capital (WACC) for the company is 9.22%. To calculate WACC, we need to take a weighted average of the required rates of return for each component of the capital structure. The weights are determined by the proportion of each component in the capital structure.
The calculation is: WACC = (0.50 x 9.5%) + (0.40 x 7% x (1 - 20%)) + (0.10 x 7.5%) = 9.22%.
The weight of debt is adjusted for the tax shield of interest payments. The tax shield reduces the cost of debt to the company and makes it a cheaper source of financing compared to equity or preferred shares.
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At 31.12.21, a business reports Inventory days of 55, Payables days of 25, and Receivables Days of 15. The net working capital cycle is a. (15) Days O b. 45 Days O c. 40 Days O d. 65 Days
The net working capital cycle is calculated as inventory days plus receivables days minus payable days. In this case, the calculation would be 55 + 15 + 25 = 45 days. Therefore, the correct answer is option B, 45 days.
This means that the business takes an average of 45 days to convert inventory into cash and collect payment from customers while taking an average of 25 days to pay its suppliers. A shorter net working capital cycle is generally viewed as a positive sign as it indicates that a business is able to efficiently manage its cash flow and liquidity, which can lead to improved profitability and financial stability.
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NoGrowth Corporation currently pays a dividend of $0.47 per quarter, and it will continue to pay this dividend forever. What is the price per share of NoGrowth stock if the firm's equity cost of capital is 16.5%? The stock price is $(Round to the nearest cent)
The stock price of NoGrowth Corporation can be calculated by using the Gordon Growth Model.
According to the model, the stock price is equal to the dividend per share divided by the cost of equity minus the growth rate, i.e. P = D / (k-g).
In this case, the dividend per share is $0.47, the cost of equity is 16.5%, and the growth rate is 0, since the dividend will remain constant. Plugging the values into the equation, the stock price works out to be $2.82.
Therefore, the price per share of NoGrowth stock is $2.82 (rounded to the nearest cent).
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An account earns simple interest at an annual rate of 20%. Let i t denote the annual effective rate for year t. Find the earliest year for which it < 6%. O 12 O 14
O 13
O 10
O 11
The year 13 marks the first time that the annual effective rate is less than 6%.
To solve this problem, we need to find the earliest year (t) for which the annual effective rate (it) is less than 6%. Since the account earns simple interest at an annual rate of 20%, we can use the formula for simple interest:
Simple Interest = Principal × Rate × Time
First, we need to find the principal amount after t years with a 20% interest rate:
Principal × (1 + 0.20 × t)
Now, we need to determine the annual effective rate for year t (it). The formula for the annual effective rate is:
It = (Principal Amount After t Years / Principal Amount) (1/t) - 1
Substitute the expression for the principal amount after t years:
It = [(Principal (1 + 0.20 t)) / Principal] ^(1/t) - 1
Notice that the principal amount will cancel out:
it = [(1 + 0.20 × t)]^(1/t) - 1
We need to find the earliest year for which it is less than 6% (0.06). We can do this by trying different values of t.
t = 10: it = [(1 + 0.20 × 10)]^(1/10) - 1 = 0.0718 (7.18%)
t = 11: it = [(1 + 0.20 × 11)]^(1/11) - 1 = 0.0656 (6.56%)
t = 12: it = [(1 + 0.20 × 12)]^(1/12) - 1 = 0.0603 (6.03%)
t = 13: it = [(1 + 0.20 × 13)]^(1/13) - 1 = 0.0556 (5.56%)
At t = 13, the annual effective rate is less than 6%. Therefore, the earliest year for which it is less than 6% is 13.
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Risk free rate 1.90% Market risk premium 6.35% A stock with beta of 1.31 just paid a dividend of $2.16 The dividend is expected to grow at 20.85% for 3 years and then grow 3.06% forever What is the value of the stock?
The value of the stock is $58.47.
To calculate the value of the stock, follow these steps:
1. Calculate the required rate of return using the Capital Asset Pricing Model (CAPM): Risk-free rate + Beta * Market risk premium = 1.90% + 1.31 * 6.35% = 10.32%.
2. Calculate the dividends for the first three years:
Year 1: $2.16 * (1 + 20.85%) = $2.61
Year 2: $2.61 * (1 + 20.85%) = $3.15
Year 3: $3.15 * (1 + 20.85%) = $3.81
3. Calculate the dividend in Year 4, which is the first year of the constant growth phase: $3.81 * (1 + 3.06%) = $3.92.
4. Calculate the stock price at the end of Year 3 using the Gordon growth model: D4 / (Required rate of return - Constant growth rate) = $3.92 / (10.32% - 3.06%) = $52.36.
5. Calculate the present value of dividends for the first three years and the stock price at the end of Year 3, discounting them by the required rate of return:
PV(D1) = $2.61 / (1 + 10.32%) = $2.37
PV(D2) = $3.15 / (1 + 10.32%)² = $2.58
PV(D3) = $3.81 / (1 + 10.32%)³ = $2.77
PV(Stock price at the end of Year 3) = $52.36 / (1 + 10.32%)³ = $50.75
6. Add the present values to find the stock's value: $2.37 + $2.58 + $2.77 + $50.75 = $58.47.
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what is a disaster recovery plan? a separate and fully equipped facility where the company can move immediately after a disaster and resume business
A disaster recovery plan is a detailed strategy developed by a company to prepare for and respond to potential disasters that could interrupt its business operations.
What's disaster recovery planThe plan typically outlines procedures and protocols for ensuring the safety of employees, safeguarding critical data and systems, and minimizing downtime and financial losses in the aftermath of a disaster.
One key component of a disaster recovery plan is having a separate and fully equipped facility, known as a backup or recovery site, where the company can move immediately after a disaster and resume business operations.
This facility should be able to provide all the necessary resources and infrastructure to allow the company to function temporarily until normal operations can be restored at the primary site.
A well-developed disaster recovery plan can help businesses to mitigate the impact of disasters and ensure their long-term survival.
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alderfer’s erg theory postulates that people have three basic sets of needs: existence, ________, and growth, which can operate simultaneously.
Alderfer's ERG theory postulates that people have three basic sets of needs: existence, relatedness, and growth, which can operate simultaneously.
Alderfer's ERG theory is a human motivation model that was developed by Clayton Alderfer in the 1960s. It is an extension of Maslow's hierarchy of needs, which classified human needs into five categories arranged in a pyramid structure, from the most basic physiological needs at the bottom to self-actualization needs at the top.
Alderfer's ERG theory, on the other hand, proposes that there are three basic sets of human needs: Existence, Relatedness, and Growth, which can operate simultaneously and interact with each other in complex ways.
Existence Needs: These are the most basic and essential needs of individuals, which include physiological and safety needs, such as food, shelter, water, and security.
Relatedness Needs: These are the social and interpersonal needs of individuals, which include the need for love, affection, belongingness, and social interaction with others.
Growth Needs: These are the higher-order needs of individuals, which include the need for self-esteem, self-actualization, personal development, and achievement.
According to Alderfer's theory, individuals may pursue these three sets of needs simultaneously, rather than in a hierarchical sequence, and the satisfaction or frustration of one need may lead to changes in the intensity or direction of other needs.
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according to keynesian theory: a. the long-run and short-run aggregate supply curves are identical. b. a decrease in aggregate demand leads to decreases in output and prices. c. a decrease in aggregate demand will decrease prices, but not output. d. the short run is relatively unimportant. e. an economic recession will self-correct without policy intervention.
According to Keynesian theory, a decrease in aggregate demand leads to decreases in output and prices.
This is because in the short run, prices are sticky and businesses cannot adjust their prices immediately in response to changes in demand. Therefore, a decrease in demand will result in a decrease in output as businesses produce less to match the lower demand, and a decrease in prices as businesses eventually lower their prices to clear their inventory. It is important to note that Keynesian theory emphasizes the importance of the short run, as this is the period during which prices are sticky and output can be affected by changes in demand. The long-run and short-run aggregate supply curves are not identical, as the long-run curve assumes that prices have fully adjusted to changes in demand. Additionally, an economic recession will not self-correct without policy intervention, as Keynesians argue that the government should use fiscal and monetary policies to stimulate demand and stabilize the economy.
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the consumer price index rises from 241 to 260. how much of an increase in pay (measured in percentage terms) should you receive in order to keep your real income fixed
If the consumer price index (CPI) rises from 241 to 260, it means that the general price level of goods and services has increased by around 8%. This means that if your salary or wages remain the same, your purchasing power would be reduced by 8% due to the increase in prices.
To keep your real income fixed, you would need to receive a pay increase of at least 8%. This is because an 8% increase in pay would match the increase in prices and would allow you to maintain the same purchasing power as before the CPI rise.
It is essential to consider inflation when looking at salary increases as it impacts the real value of your earnings. If your pay increase is lower than the inflation rate, your purchasing power will decrease, and your standard of living will be affected.
In conclusion, to maintain your real income fixed when the CPI rises from 241 to 260, you need a pay increase of at least 8%. Employers should factor in inflation when determining salary increases to ensure that their employees' purchasing power and standard of living are not negatively affected by rising prices.
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1) Determine the price in USD of a bond that was issued on April 1, 2020 and is set to mature on April 1, 2035. This bond pays a coupon of 5% semi-annually. The face value is $5,000. The yield to maturity is currently 4.5%
To determine the price of the bond, we need to use a present value formula. The present value of a bond is equal to the present value of the coupon payments plus the present value of the face value.
To calculate the present value of the coupon payments, we need to use the following formula:Coupon Payment * [1 - (1 + Yield to Maturity / 2) ^ (-Number of Semi-Annual Periods)] / (Yield to Maturity / 2)
Using the given information, we can calculate the present value of the coupon payments as follows:
Coupon Payment = 5% * $5,000 / 2
= $125
Number of Semi-Annual Periods = (2035 - 2020) * 2
= 30
Yield to Maturity = 4.5% / 2
= 2.25%
Present Value of Coupon Payments = $125 * [1 - (1 + 2.25%) ^ (-30)] / (2.25%)
= $2,383.76
To calculate the present value of the face value, we need to use the following formula:
Face Value / (1 + Yield to Maturity / 2) ^ (Number of Semi-Annual Periods)
Using the given information, we can calculate the present value of the face value as follows:
Present Value of Face Value = $5,000 / (1 + 2.25%) ^ 30
= $2,407.78
Finally, we can calculate the price of the bond by adding the present value of the coupon payments and the present value of the face value:
Price of Bond = $2,383.76 + $2,407.78
= $4,791.54
Therefore, the price in USD of the bond that was issued on April 1, 2020, and is set to mature on April 1, 2035, is $4,791.54.
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Would Samsung post higher profits if the South Koreanwon increased or decreased in value relative to othercurrencies?
Samsung could potentially post higher profits if the South Korean won decreased in value relative to other currencies.
The reasoning behind this is as follows:
1. Export competitiveness: A decrease in the value of the South Korean won relative to other currencies would make Samsung's products cheaper for consumers in foreign markets, resulting in increased demand and sales.
2. Foreign exchange gains: When the won decreases in value, Samsung's foreign-currency-denominated revenues, when converted back to won, would increase, leading to higher overall profits.
3. Lower production costs: A weaker won could result in lower costs for imported raw materials and components, which would lower Samsung's production costs and potentially increase their profit margin.
It's important to note that currency fluctuations can have complex effects on a company's financial performance, and various factors may influence the relationship between currency values and a company's profits.
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a self-report technique for attitude measurement in which respondents indicate their degree of agreement or disagreement with each of a number of statements
Likert Scale, which is a self-report technique for attitude measurement. In this method, respondents indicate their degree of agreement or disagreement with each of a number of statements, allowing researchers to assess their attitudes or opinions on a particular topic in a quantifiable manner.
The Likert Scale allows researchers to obtain quantitative data by assigning numerical values to the responses. This makes it easier to analyze and interpret the data statistically. \
Researchers can calculate means, standard deviations, and other statistical measures to summarize and compare the responses. Additionally, researchers can use the Likert Scale to assess the distribution and variability of responses, identify trends or patterns, and make comparisons across different groups or time points.
One of the advantages of using the Likert Scale is its versatility and ease of administration. It can be used to measure a wide range of attitudes, opinions, or perceptions on various topics, such as opinions on social issues, customer satisfaction, employee feedback, and more.
It is also a cost-effective and time-efficient method, as it can be administered through paper-and-pencil surveys, online surveys, or interviews.
However, it's important to note that the Likert Scale has some limitations. It relies on self-report data, which may be subject to social desirability bias or other biases.
Respondents may not always provide accurate or truthful responses, and their attitudes or opinions may change over time. Additionally, the scale itself may have limitations in capturing the complexity or nuances of attitudes or opinions, as it may force respondents to simplify their responses into predefined categories.
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In order to compute the current ratio you would need which of the following?
A. The amount of total fixed equipment on the balance sheet.
B. the dollar amount of current assets.
C. the dollar amount of fixed assets.
D. the dollar amount of total assets.
E. all of the above.
In order to compute the current ratio you would need the dollar amount of current assets. Option B is the correct answer.
It is because the current ratio is a measure of a company's ability to pay its short-term obligations using its current assets. It is calculated by dividing current assets by current liabilities. Therefore, to calculate the current ratio, you need the dollar amount of current assets and current liabilities.
Total fixed equipment and fixed assets are not relevant to the calculation of the current ratio, although the dollar amount of total assets is needed to calculate other financial ratios such as the debt-to-assets ratio. Therefore, option B is the only answer that correctly identifies the necessary information to calculate the current ratio.
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QUESTION 8 Determining the Claim Amount. Fred currently has an auto insurance policy that has a $1,000 deductible on his vehicle. He did have optional coverage under his accident benefits component of his coverage that will provide him with towing charges up to 100 km, a replacement rental vehicle while repairs are being done up to maximum $1,000, and up to $1,000 of medical coverage for chiropractic care due to an injury. He has an accident and his expenses are: Towing (80km driven to repair shop) $400, car rental expenses of $1,250 while his car is being repaired, and chiropractic coverage for a neck injury that cost $1,500, What would his claim be and amount he would be covered for? How much will he have to pay out of pocket himself? Put your final answers below. Round to the nearest whole number. What would his claim be and amount he would be covered for? $ How much will he have to pay out of pocket himself? $
Fred's claim would be $2,150, and he will have to pay $1,000 out of pocket himself.
The amount of coverage Fred has for towing is up to 100km, but he only drove 80km, so he will be covered for the full $400 towing charge. For the car rental, his coverage is up to a maximum of $1,000, so he will be covered for $1,000 of the $1,250 rental expenses.
As for the chiropractic care, he will be covered for the full $1,500. Therefore, the total amount of his claim is $400 + $1,000 + $1,500 = $2,900.
However, since his policy has a $1,000 deductible, he will have to pay that amount out of pocket. So, the final amount he will be covered for is $2,900 - $1,000 = $1,900. Rounded to the nearest whole number, his claim would be $2,150 ($1,900 covered + $1,000 deductible) and he will have to pay $1,000 out of pocket himself.
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are effective when there are many production facilities, points of distribution, and products. a. pull systems b. push systems c. mass-production systems d. mass-customization systems in. decision support systems
The option that describes systems that are effective when there are many production facilities, points of distribution, and products is mass-customization systems. Option D is correct.
Mass-customization systems are designed to provide customers with unique and personalized products while achieving the efficiency and economies of scale of mass production. These systems can handle a large number of production facilities, points of distribution, and products by using flexible and adaptable manufacturing processes, just-in-time inventory management, and advanced information technology.
Pull systems and push systems are production planning and control strategies that are used to manage the flow of materials and products through the supply chain, but they do not specifically address the challenges of mass-customization. Mass-production systems are optimized for high volume and low-cost production of standardized products, and may not be adaptable to changing customer demands or a diverse product mix.
Decision support systems are information systems that support decision-making activities, but they are not specifically related to production and supply chain management.
Hence, D. is the correct option.
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--The given question is incomplete, the complete question is
"Describes systems are effective when there are many production facilities, points of distribution, and products. a. pull systems b. push systems c. mass-production systems d. mass-customization systems e. decision support systems."--
the quantity demanded of a good is the amount that buyers are group of answer choices willing to purchase. willing and able to purchase. willing, able, and need to purchase. able to purchase.
The quantity demanded of a good is the amount that buyers are willing and able to purchase. So, second option is correct.
The term "quantity demanded" refers to the specific amount of a good that buyers are willing to purchase at a particular price. This means that buyers have both the desire and ability to purchase a certain amount of the good at a specific price point. It is important to note that the quantity demanded is not the same as the actual number of units sold. The actual number of units sold depends on a number of factors including price, availability, and the overall market demand. However, the quantity demanded is a crucial factor in determining the price point at which buyers are willing to purchase a particular good.
Buyers play a crucial role in the determination of the quantity demanded. The willingness and ability of buyers to purchase a particular good at a given price point is dependent on a number of factors such as their income level, personal preferences, and the availability of alternative goods. As such, understanding the preferences and behaviors of buyers is essential for businesses and individuals looking to sell goods and services. In summary, the quantity demanded of a good is the amount that buyers are willing and able to purchase at a particular price point. Buyers play a crucial role in determining the quantity demanded and understanding their preferences and behaviors is essential for businesses and individuals looking to sell goods and services.
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