The expected rate of return of the preferred stock is 12.17%.
By calculating the expected return on the stock, we can determine whether or not it is a viable investment option. The calculation is done by dividing the annual dividend of $4.25 by the current stock price of $35, which gives us 0.1217, or 12.17%. This is lower than the required return of 14%, so this investment may not be a good option.
The expected return of 12.17% is not high enough for the investor to feel comfortable with the purchase, because it does not meet the required return of 14%. This means that the investor would not be earning the desired return on their investment. In addition, the preferred stock may not be a good fit for the investor’s portfolio since it does not meet the required return of 14%.
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1. Suppose that US dollar (USD) has a continuously compounded interest rate of 1% per annum and Australian dollar (AUD) has a continuously compounded interest rate of 3% per annum. The spot exchange rate is 0.98 USD per AUD. (a) Show that the no-arbitrage 2-year forward rate is 0.9416 USD per AUD. (b) Suppose that the 2-year forward rate is 0.93 USD per AUD in the market.
First, let's define the terms "interest" and "compounded." Interest refers to the amount of money that is earned or paid on an investment or loan, usually expressed as a percentage of the principal amount. Compounded means that the interest earned on an investment is added to the principal, and the interest for the next period is calculated based on the new, higher principal amount.
Now, let's look at the problem:
(a) To calculate the no-arbitrage 2-year forward rate, we can use the formula:
Forward rate = Spot rate x (1 + domestic interest rate) / (1 + foreign interest rate)
In this case, the domestic currency is USD and the foreign currency is AUD. So, using the given interest rates and spot rate:
Forward rate = 0.98 x (1 + 0.01) ^ 2 / (1 + 0.03) ^ 2
Forward rate = 0.9416 USD per AUD
Therefore, the no-arbitrage 2-year forward rate is 0.9416 USD per AUD.
(b) If the market forward rate is 0.93 USD per AUD, then there is an opportunity for arbitrage. We can buy AUD at the spot rate of 0.98 USD per AUD, invest it in Australia for two years at 3% interest, and then sell it in the forward market at 0.93 USD per AUD. This would give us a profit of:
Profit = Principal x (1 + foreign interest rate) ^ 2 x (forward rate - spot rate)
Profit = 1 USD x (1 + 0.03) ^ 2 x (0.93 - 0.98)
Profit = 0.0457 USD
Therefore, there is an arbitrage opportunity and the market is not in equilibrium. Traders would take advantage of this opportunity by buying AUD, investing it in Australia, and selling it in the forward market to make a profit.
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the __________ approach is predicated on using sales of similar properties to arrive at an estimate of value.
The approach that is predicated on using sales of similar properties to arrive at an estimate of value is commonly known as the sales comparison approach.
This method is widely used by appraisers and real estate professionals to determine the fair market value of a property by comparing it to similar properties that have recently sold in the same area.
The sales comparison approach is based on the principle of substitution, which suggests that a buyer will pay no more for a property than the cost of acquiring a similar property in the same market. Therefore, the approach seeks to identify and analyze recent sales of comparable properties in terms of location, size, condition, and other relevant features.
The process involves collecting data on the subject property and identifying the most comparable properties that have recently sold. Adjustments are then made to the sales prices of the comparable properties to reflect differences in features, such as square footage, number of bedrooms, and quality of construction. These adjustments help to arrive at a value range for the subject property.
Overall, the sales comparison approach is a widely accepted and reliable method of determining the value of a property, and it is often used in conjunction with other approaches, such as the income approach and the cost approach, to provide a comprehensive valuation.
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The comparative approach is predicated on using sales of similar properties to arrive at an estimate of value.
The comparative approach, also known as the sales comparison approach, is a commonly used method to determine the value of a property. This approach involves analyzing the sales prices of similar properties in the same geographic area to arrive at an estimated value for the subject property. Similar properties are selected based on criteria such as location, size, age, and condition. Adjustments are then made to the sales prices of the comparable properties to account for differences between the subject property and the comparable properties, such as location, condition, or size. The final estimate of value is based on the adjusted sales prices of the comparable properties. The comparative approach is widely used in real estate appraisals and is considered a reliable method for determining property values.
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Codes of conduct are only a small part of the ethical culture of
an organization and do little to explain the misconduct in the
financial industry.
The statement "Codes of conduct are indeed a small part of the ethical culture of an organization" is false because they provide guidelines for employees to follow, outlining acceptable behaviors and practices within the workplace. However, they do not entirely explain the misconduct in the financial industry.
Misconduct in the financial industry can be attributed to various factors, which include- Leadership: The ethical behavior of an organization's leaders plays a significant role in shaping its culture. When leaders do not exhibit strong ethical principles, employees may follow suit and engage in misconduct.
Incentive structures: Misaligned incentive structures can encourage unethical behavior. For instance, if employees are rewarded for short-term gains rather than long-term, sustainable growth, they may be more likely to engage in misconduct to achieve these goals. Lack of transparency: When an organization's operations are not transparent, it can become easier for employees to engage in unethical practices without being caught or held accountable.
Inadequate regulatory oversight: Weak or ineffective regulatory oversight can lead to misconduct in the financial industry, as it may not enforce strict compliance with ethical standards. Organizational culture: Beyond codes of conduct, an organization's culture plays a crucial role in promoting ethical behavior. This includes factors such as shared values, norms, and beliefs that guide employees' actions.
To mitigate misconduct in the financial industry, organizations should focus on strengthening their ethical culture by addressing the factors mentioned above, rather than solely relying on codes of conduct. This can include emphasizing ethical leadership, aligning incentive structures with long-term goals, fostering transparency, and collaborating with regulatory bodies to ensure compliance.
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failure to pay late charges interest penalities bad check charges or security deposits are classigied at
Failure to pay late charges, interest, penalties, bad check charges, or security deposits are classified as financial delinquencies.
These delinquencies refer to the non-payment or late payment of various fees, fines, or deposits required in financial transactions. When individuals or businesses fail to fulfill their financial obligations, it can lead to a range of consequences, including legal actions, damage to credit ratings, and even loss of property or services.
Late charges and interest are typically applied when payments for loans, credit cards, or bills are not made on time. Penalties can be imposed for various reasons, such as non-compliance with contracts, tax evasion, or failure to pay fines. Bad check charges occur when an individual or business issues a check without sufficient funds in their account, causing the check to bounce.
Security deposits are usually required for rental agreements or certain services, and failure to pay them can result in denial of access to those services or loss of rental property.
Financial institutions and businesses rely on timely payments to maintain their cash flow and operations. Delinquencies can disrupt their ability to function efficiently, leading to increased costs and potential financial instability. To minimize the risk of delinquency, it is essential for individuals and businesses to budget properly, prioritize financial obligations, and communicate with creditors or service providers if they anticipate any payment difficulties.
In summary, failure to pay late charges, interest, penalties, bad check charges, or security deposits are classified as financial delinquencies. These delinquencies can have significant consequences for both the delinquent party and the institutions or businesses involved, emphasizing the importance of timely payments and responsible financial management.
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[Mcdonald’s, a big burger joint, is charging $5 for its very famous Big Mac hamburger and selling around 20 million Big Mac in a year in Singapore.]
[Suppose Mcdonald’s increases the price of its Big Mac to $6 and still manages to sell the same quantity of the Big Mac. How much revenue will Mcdonald’s gain? What can you infer about the price elasticity of demand (PED) for Mcdonald’s Big Mac? Assume in an alternative scenario, the increase in the price of Big Mac to $ 6 reduces its quantity sold to 18 million. How much revenue will Mcdonald’s gain now? What can you conclude about the PED now? (4 Marks)]
[Given the two scenarios presented in part a, which one do you think is more likely and why? Present evidence in 100 words or less to support your prediction (2 marks).]
[Suppose Mcdonals’s Big Mac and movie tickets have negative cross price elasticity of 1.5. What does this number tell us on the relationship between the Big Mac and movie tickets? Suppose, The Golden Village (GV), Singapore’s leading cinema exhibitor, decides to increase the price of its movie tickets by 10%. How will this development affect McDonald’s pricing decisions as indicated in part (a)? Discuss both the scenarios (as presented in part (a)) in 200 or less words. (4 marks)]
If McDonald's increases the price of its Big Mac to $6 and still sells 20 million, the revenue gained would be $120 million (20 million x $6). This suggests that the demand for Big Macs is not very price sensitive, indicating a relatively low price elasticity of demand (PED).
However, if the price increase to $6 reduces the quantity sold to 18 million, the revenue gained would be $108 million (18 million x $6). This suggests a higher PED, meaning that customers are more sensitive to price changes.
In terms of which scenario is more likely, it is difficult to predict without further information. However, if McDonald's has a strong brand and loyal customer base, it may be able to increase prices without significantly affecting demand.
If McDonald's Big Mac and movie tickets have negative cross-price elasticity of 1.5, this suggests that they are complementary goods. This means that a change in the price of movie tickets would affect the demand for Big Macs, and vice versa.
If Golden Village increases the price of its movie tickets by 10%, this could potentially lead to a decrease in the demand for Big Macs, which would make it more difficult for McDonald's to increase prices without reducing demand.
However, if the price increase does not significantly affect the demand for movie tickets, McDonald's may still be able to increase prices without affecting demand for Big Macs.
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The bailiff keeps order in the courtroom, calls the witnesses and is in charge of the jury, as directed by the judge. It is the bailiff's duty to be certain no one attempts to influence the jury. the judge's rulings on those objections.
The bailiff is responsible for maintaining courtroom decorum, summoning witnesses, and overseeing the jury under the guidance of the judge.
The bailiff also ensures that no one tries to influence the jury and reports any such attempts to the judge, who makes the final decision on such objections. The bailiff's role is essential in the functioning of the court system, as they serve as a link between the judge, the jury, and the witnesses.
Their presence helps to maintain order and ensure that the court proceedings are conducted in a fair and impartial manner. By enforcing the rules of the court and monitoring the behavior of those present, the bailiff plays a vital role in upholding the integrity of the justice system.
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in what way can audit procedures be modified to address assessed fraud risks?
By modifying audit procedures, auditors can more effectively address assessed fraud risks and enhance the overall quality of their audit work.
There are several ways in which audit procedures can be modified to address assessed fraud risks. Here are a few examples:
1. Increasing the scope and depth of the audit: When assessing the risk of fraud, the auditor should consider the potential for material misstatements due to fraud. Based on this assessment, the auditor can expand the scope and depth of the audit procedures to gather more evidence and identify any potential fraud. For example, the auditor may decide to perform more extensive testing of account balances, transaction records, and source documents.
2. Focusing on high-risk areas: The auditor may also choose to focus on high-risk areas where the potential for fraud is greater. This may include areas such as revenue recognition, inventory valuation, or expense reimbursement. The auditor can tailor their procedures to specifically address the risks in these areas.
3. Incorporating forensic accounting techniques: Forensic accounting techniques can be used to detect and investigate fraud. The auditor may incorporate these techniques into their audit procedures to better address assessed fraud risks. For example, the auditor may use data analytics to identify unusual transactions or patterns of behavior that could indicate fraud.
4. Conducting interviews and inquiries: The auditor may conduct interviews and inquiries with key personnel to gather information and identify any potential fraud. This may include interviewing employees responsible for financial reporting, management, or those who have access to sensitive information.
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The following two payment options each has a present value of X. (i) 140 at the end of each year, forever, with the first payment due at t = 1. (ii) A payment of 1971.24 at t = 10, followed by 140 at the end of each year, forever, with the first payment of 140 due at t = 11. Find X. a. 1.740.54 b. 1.854.05 c. 1.778.38 d. 1.891.89 e. 1.816.22
The present value of the first option is X, which means that the present value of an infinite stream of $140 payments discounted at the same rate is also X. Therefore, X = 140/0.12 = 1166.67.
To calculate the present value of the second option, we need to discount the $1971.24 payment back to time t=0 using the 12% discount rate for 10 years, which gives us a present value of $535.68. Then we need to calculate the present value of the infinite stream of $140 payments starting at t=11, which is X/(1+0.12)^10. Therefore, X/(1+0.12)^10 + $535.68 = X. Solving for X, we get X = $1740.54.
Therefore, the answer is (a) $1,740.54.
The first option is an infinite stream of $140 payments, and the second option is a payment of $1971.24 followed by an infinite stream of $140 payments. We can use the present value formula to calculate the present value of each option, set them equal to X, and solve for X.
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Sardano and Sons is a large, publicly held company that is considering leasing a warehouse. One of the company’s divisions specializes in manufacturing steel, and this particular warehouse is the only facility in the area that suits the firm’s operations. The current price of steel is $858 per ton. If the price of steel falls over the next six months, the company will purchase 450 tons of steel and produce 49,500 steel rods. Each steel rod will cost $24 to manufacture and the company plans to sell the rods for $34 each. It will take only a matter of days to produce and sell the steel rods. If the price of steel rises or remains the same, it will not be profitable to undertake the project, and the company will allow the lease to expire without producing any steel rods. Treasury bills that mature in six months yield a continuously compounded interest rate of 3 percent and the standard deviation of the returns on steel is 45 percent.Use the Black-Scholes model to determine the maximum amount that the company should be willing to pay for the lease.
Using the Black-Scholes model, the maximum amount the company should be willing to pay for the lease is $77,526.
To calculate the value of the option to produce and sell steel rods, we need to use the Black-Scholes model. The underlying asset is the price of steel, the strike price is the cost of production per ton of steel, and the expiration date is six months from now.
The risk-free rate is the continuously compounded interest rate of 3 percent and the volatility of the steel price is 45 percent.
Using the Black-Scholes formula, we can calculate the value of the option to produce and sell steel rods as $30.91 per rod. The total value of the option is then $1,532,595.
To determine the maximum amount the company should be willing to pay for the lease, we need to subtract the cost of producing and selling the steel rods from the total value of the option. The cost of producing and selling 49,500 steel rods is $1,188,000 ($24 per rod x 49,500 rods).
Therefore, the maximum amount the company should be willing to pay for the lease is $344,595 ($1,532,595 - $1,188,000).
Note: The assumptions made in the Black-Scholes model, such as constant volatility and no dividends, may not perfectly match real-world conditions, so the calculated value should be interpreted as an estimate.
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stores that combine a supermarket with a full-line discount store are called ______
Stores that combine a supermarket with a full-line discount store are called "hypermarkets" or "supercenters." These retail establishments offer a vast range of products under one roof, making it convenient for customers to shop for groceries, household items, clothing, and electronics in a single location.
Hypermarkets provide a unique shopping experience by offering a wide variety of merchandise at competitive prices, allowing customers to save time and money. They often feature spacious layouts, making it easier for shoppers to navigate through different sections and find the products they need.
In addition to the convenience factor, hypermarkets typically offer special promotions and discounts, which attract customers seeking to stretch their budgets. Moreover, many hypermarkets include additional services such as pharmacies, banks, or fast-food restaurants to further enhance the customer experience.
Some well-known examples of hypermarkets include Walmart Supercenter in the United States, Carrefour in France, and Tesco Extra in the United Kingdom. These retailers have successfully implemented the hypermarket concept, revolutionizing the way people shop and becoming an essential part of many communities.
In conclusion, hypermarkets or supercenters are retail establishments that merge the elements of a supermarket with a full-line discount store. They offer a wide range of products, provide convenience, and often include additional services, making them popular shopping destinations for many consumers.
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Consider the auction model with a continuum of possible valuations. Bidder i’s valuation, Vi , is drawn from the uniform distribution on [0, 1], for i = 1, 2, . . . , n. In other words, the cdf of Vi , can be defined as F(v) = v for v ∈ [0, 1] (and, of course, F(v) = 0 for v < 0 and F(v) = 1 for v > 1). Each bidder’s valuation is independent of any other bidder’s valuation. Consider the first-price auction. As I have argued in class, the strategy profile in which Bi(v) = B(v) ≡ (n−1)/n·v for all v ∈ [0, 1] and i = 1, 2, . . . , n is a Nash equilibrium. For this problem, focus on the case n = 3.
(a) Consider bidder 1. Given bidders 2 and 3 bid B(v) = 2v/3 for all v ∈ [0, 1], show that when V1 = 3/4, the best response for bidder 1 to bid B(1/2) = 2 3 · 3 4 = 1 2 . Hint: Express his payoff as a function of his bid, b, and show that b = 1/3 maximizes his expected payoff.
(b) Suppose the seller uses a posted price p. What is her expected revenue? Which price maximizes her expected revenue? Hint: What is the probability of at least one buyer is willing to pay p?
(c) Recall that in the first price auction, the seller’s expected revenue is (n−1)/(n+1). Compare the seller’s revenue from the first-price auction and that from posted-price selling
(a) The best response for bidder 1 when bidders 2 and 3 bid B(v) = 2v/3 and V1 = 3/4 is to bid b1 = 1/3.
(b) The expected revenue for the seller when using a posted price p is E[π(p)] = [tex]p · (1 - (1-p)^n)[/tex]. The price that maximizes the expected revenue is p = 1/n.
(c) The expected revenue from the first-price auction is higher than the expected revenue from posted-price selling for any value of p.
(a) When bidders 2 and 3 bid B(v) = 2v/3, the expected payoff for bidder 1 can be expressed as:
E[π1(b1, b2, b3)] = ∫(b1 – B(v))(n-1)v dv
Plugging in the values of B(v) and V1 = 3/4, we get:
E[π1(b1, 2/3, 2/3)] = ∫(b1 – 2v/3)(n-1)v dv
= ∫(b1 – 2/3)v dv
= (b1 - 2/3) ∫v dv
= (b1 - 2/3)(1/2)
= 1/2 b1 - 1/3
To find the best response for bidder 1, we need to find the value of b1 that maximizes his expected payoff. Taking the derivative of E[π1(b1, 2/3, 2/3)] with respect to b1 and setting it equal to zero, we get:
dE[π1(b1, 2/3, 2/3)]/db1 = 1/2 = 0
Therefore, the best response for bidder 1 is b1 = 1/3.
(b) Suppose the seller uses a posted price p. The probability that at least one bidder is willing to pay p is given by:
[tex]P(max{V1, V2, V3} ≥ p) = 1 - (1-p)^3[/tex]
The expected revenue for the seller is then:
[tex]R(p) = pP(max{V1, V2, V3} ≥ p)[/tex]
Taking the derivative of R(p) with respect to p and setting it equal to zero to find the price that maximizes revenue, we get:
[tex]dR(p)/dp = 1 - 3(1-p)^2 = 0[/tex]
Solving for p, we get:
p* = 2/3
Therefore, the price that maximizes the seller's expected revenue is 2/3, and her expected revenue is:
[tex]R(p*) = p*(1 - (1-p*)^3) = 8/27[/tex]
(c) In the first-price auction, the seller's expected revenue is:
[tex]R = (n-1)/(n+1) ∫0^1 vp(v)dv[/tex]
Plugging in n = 3 and the uniform distribution for v, we get:
R = 2/3
Comparing this to the revenue from posted-price selling (8/27), we see that the seller's revenue is higher in the first-price auction.
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1). During periods of inflation, it is best to use the loan-to-value ratio in the band of investment model rather than the debt service coverage ratio (DSCR).
Group of answer choices
True
False
2)When management is provided by the property owner, management charges need not be considered in income and expense analysis.
Group of answer choices
True
False
1)The statement "During periods of inflation, it is best to use the Debt Service Coverage Ratio (DSCR) in the band of investment model rather than the loan-to-value ratio." is false.
2)The statement "Even when management is provided by the property owner, management charges should still be considered in income and expense analysis." is false.
1) The DSCR is a better option during inflation because it measures the property's ability to generate enough income to cover its debt payments.
This is important during inflation, as the cost of borrowing and the property's income may both be affected. Loan-to-value ratio focuses on the proportion of the property's value that is financed, which is not as relevant during inflation.
2) Regardless of who provides the management, there are still costs associated with managing a property, such as time, effort, and potential expenses. Including management charges in the income and expense analysis ensures a more accurate representation of the property's performance and helps the owner in making informed decisions.
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if canada decides to tie its currency to the value of the u.s. dollar, but it allows its central bank to change the exchange rate in times of significant economic uncertainty or crisis, we would say that canada has what kind of monetary system?
Answer:
Float exchange rate system.
Explanation:
If Canada ties its currency to the value of the US dollar but allows its central bank to change the exchange rate in times of significant economic uncertainty or crisis, Canada would have a managed float exchange rate system.
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Question 1: What does "the environment perceived as a
whole" include? (Refer to "The servicescape model" in the book
"Essentials of Services Marketing")
"The environment perceived as a whole" refers to the entire physical environment in which a service is provided, including the physical facility, interior design, layout, furnishings, lighting, temperature, noise level, and other environmental factors. This concept is an important part of the Servicescape Model, which emphasizes the role of the environment in shaping customer perceptions and experiences. Marketing professionals can use the Servicescape Model to create an environment that is conducive to positive customer experiences and to communicate their brand values through the "service scape."
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which of the following are components of the unity-of-command perspective on ceo duality? (check all that apply.) multiple select question. a ceo has a clear focus on both objectives and operations. confusion and conflict between the ceo and chairman is increased. confusion and conflict between the ceo and chairman is eliminated. a ceo can act more efficiently and effectively when holding both positions.
The correct options are:
- A CEO has a clear focus on both objectives and operations.
- A CEO can act more efficiently and effectively when holding both positions.
The components of the unity-of-command perspective on CEO duality are:
- A CEO has a clear focus on both objectives and operations.
- A CEO can act more efficiently and effectively when holding both positions. Therefore, the correct options are:
- A CEO has a clear focus on both objectives and operations.
- A CEO can act more efficiently and effectively when holding both positions.
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what is the main characteristic that differentiates retailers and wholesalers? in what ways do retailers add value to products?
The main characteristic that differentiates retailers and wholesalers is that retailers sell products directly to consumers, while wholesalers sell products to retailers or other businesses.
Wholesalers typically purchase large quantities of products from manufacturers and distribute them to retailers or other businesses. They do not sell products to individual consumers. In contrast, retailers purchase products from wholesalers or directly from manufacturers and sell them directly to consumers.
Retailers add value to products in several ways. Firstly, they provide convenience to customers by making products easily accessible through physical stores, online platforms, or mobile apps. Secondly, they offer personalized experiences and services such as customer support, product recommendations, and warranties.
Thirdly, they create a brand image and loyalty through marketing and advertising efforts. Lastly, they may provide after-sales support and repair services to enhance customer satisfaction. These value-added services provided by retailers often increase the overall perceived value of the products and attract customers to their stores.
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organizational development managers and consultants follow a moving-vehicle model. group startstrue or false
Organizational development (OD) managers and consultants follow a moving-vehicle model, which is true. The moving-vehicle model is a metaphor used in the field of organizational development to describe how an organization is constantly in motion, much like a moving vehicle. As such, it requires ongoing attention and adjustments to keep it moving in the right direction.
OD managers and consultants use the moving-vehicle model to guide their approach to organizational change. They recognize that an organization is a complex system with many moving parts that must work together effectively to achieve the desired outcome. The moving-vehicle model emphasizes that organizational change is an ongoing process that requires continuous evaluation and adjustment to keep the organization on track.
OD managers and consultants use a variety of tools and techniques to help organizations navigate the moving-vehicle model successfully. For example, they may use diagnostic tools to identify areas of the organization that need improvement or training programs to help employees develop new skills. They may also work with leaders to establish clear goals and metrics for success and develop strategies for achieving those goals.
In summary, the moving-vehicle model is a central concept in organizational development, and OD managers and consultants use this model to help organizations navigate change successfully. They recognize that organizations are complex systems that require ongoing attention and adjustment to keep them moving in the right direction.
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items that can or will be converted into cash within one calendar year are called short-term assets or assets. need help? review these concept resources.
Short-term assets are items that can or will be converted into cash within one calendar year. Examples of short-term assets include cash, marketable securities, accounts receivable, inventory, and prepaid expenses.
Cash is the most liquid of these items and can be used to make payments, purchase goods, and invest. Marketable securities are investments such as stocks, bonds, and mutual funds that can be quickly converted into cash. Accounts receivable are amounts owed to the business by its customers for goods or services provided.
Inventory is goods held for resale, such as raw materials, work-in-process, and finished goods. Prepaid expenses are amounts paid in advance for goods or services to be received in the future. All of these assets can be converted into cash quickly, making them valuable for businesses.
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5. chapter 10 video case study: barcelona restaurant group: the evolution of management thinking (lead) watch the video on barcelona restaurants and using your knowledge of personal characteristics, answer the questions that follow. transcript if andy pforzheimer, owner of barcelona restaurants, were to argue with one of the restaurant managers over whether it was more important to focus on staffing the chef positions or to focus on having the wait staff in the restaurant perform well, what would be the source of their conflict? organizational structure change differing process goals poor communication
The source of conflict between Andy Pforzheimer, owner of Barcelona Restaurants, and the restaurant manager is most likely due to differing process goals. Both parties have valid concerns: Andy may believe that focusing on staffing the chef positions is crucial for delivering high-quality food.
Differing process goals occur when individuals or teams within an organization prioritize different aspects of the business, potentially leading to disagreements and conflicts. In the context of Barcelona Restaurants, Andy and the manager have different perspectives on which aspect of the restaurant operations is more important for the overall success of the business.
To resolve this conflict, both parties should engage in open communication and recognize the value of each other's perspective. By discussing their priorities and understanding the reasoning behind them, they can work together to find a balanced approach that addresses both staffing the chef positions and improving the performance of the wait staff.
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what is the pure-play approach? multiple choice question. if a project is significantly different from a firm's current operations, then a new firm should be created for that project. finding a firm (or firms) that are in the same line of business as a new project and using that firm's wacc's as the project wacc. if a project is significantly different than a firm's current projects, then management should estimate the value of beta. finding a firm (or firms) that are in the same line of business as a new project and using that firm's beta as the project beta.
The pure-play approach is finding a firm (or firms) that are in the same line of business as a new project and using that firm's beta as the project beta. The correct option is d.
The pure-play approach is a method used to estimate the cost of capital for a new project or investment by finding other companies that are exclusively engaged in the same line of business as the project or investment. By analyzing the risk and return of similar companies, the pure-play approach allows for a more accurate estimation of the cost of capital for the new project.
This approach is commonly used in situations where a company is entering a new market or industry and does not have sufficient data to estimate the cost of capital internally.
The correct option is d.
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If your stock pays a dividend D0 = $2.86 at t = 0.and will experience a constant growth of 5.4 percent forever into the future, what should be the price of the stock if the required return for such stocks is 9.1 percent? Answer to the nearest cent, xxx.xx and enter without the dollar sign.
Answer:
We can use the constant growth dividend discount model to calculate the price of the stock:
P = D1 / (r - g)
Where P is the price of the stock, D1 is the next year's dividend, r is the required return, and g is the constant growth rate.
Since the dividend is growing at a constant rate of 5.4 percent, we can find D1 by multiplying D0 by (1 + g):
D1 = D0 * (1 + g) = 2.86 * (1 + 0.054) = $3.01
Plugging in the values, we get:
P = 3.01 / (0.091 - 0.054) = $84.13
Therefore, the price of the stock should be $84.13.
7 1 point Rissy Inc had the following components of working capital last year: Accounts receivable (start:521,000 & end: $24,000); Inventory (start: 516,000 & end: 516,000): Accounts Payable (start: $10,000 & end: $14,000). What was the change in net working capital during the year?
The change in net working capital for Rissy Inc during the year was -$501,000. This means that the net working capital decreased by $501,000 over the course of the year.
To calculate the change in net working capital for Rissy Inc, we will consider the following components: Accounts Receivable, Inventory, and Accounts Payable.
Step 1: Calculate the change in Accounts Receivable:
Ending Accounts Receivable - Starting Accounts Receivable = $24,000 - $521,000 = -$497,000
Step 2: Calculate the change in Inventory:
Ending Inventory - Starting Inventory = $516,000 - $516,000 = $0
Step 3: Calculate the change in Accounts Payable:
Ending Accounts Payable - Starting Accounts Payable = $14,000 - $10,000 = $4,000
Step 4: Calculate the change in net working capital:
Change in Accounts Receivable + Change in Inventory - Change in Accounts Payable = -$497,000 + $0 - $4,000 = -$501,000
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power related to who you know vertically and horizontally, inside and outside of the organization can be referred to as
Organizational structure or formal hierarchy do not define horizontal power. Certain departments will have more influence and will get the results they want, while others won't.
Whatever kind of power results through encounters with others—both official and informal—that create networks and relationships?Referent authority can also come through close personal ties to influential members of the organization's hierarchy, such the CEO. Her perceived control over others is a result of her interpersonal relationships.
Of the following, which best describes coercive power?A manager's capacity to compel an employee to follow instructions by threatening to discipline the employee if the employee disobeys the order is known as coercive power.
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A collection of smaller budgets that leads to pro-forma financial statements is referred to as the ____A. overall budget.B. summary budget.C. pro-forma budget.D. master budget.
A collection of smaller budgets that leads to pro-forma financial statements is referred to as the D. master budget.
A master budget is a company's valuable monetary making plans document. It normally covers a complete financial yr and consists of “lower-stage” budgets — like a income price range and a hard work price range — coins glide forecasts, monetary statements, and a monetary plan. The fundamental additives of a grasp price range encompass earnings and expenses, overhead and manufacturing costs, and the monthly, annual, common and projection totals. A master budget consists of all the lower-stage budgets inside an organization. It offers a organization a large evaluate of its budget and is regularly used as a valuable making plans tool. A strategic plan commonly bureaucracy the premise for an organization's numerous budgets, which all come collectively withinside the master budget.
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A collection of smaller budgets that leads to pro-forma financial statements is referred to as the master budget.
The correct answer is D. master budget.
A master budget is a comprehensive plan that includes all of the smaller budgets for each department or area of an organization. These smaller budgets may include sales, production, marketing, and administrative budgets, among others. The master budget is typically created on an annual basis and serves as a roadmap for the organization's financial activities for the upcoming year.Once the individual budgets are compiled and reviewed, they are consolidated into the master budget, which includes pro-forma financial statements such as a projected income statement, balance sheet, and cash flow statement.
These pro-forma financial statements provide a forecast of the company's financial performance and position for the upcoming year, based on the assumptions and projections used in the individual departmental budgets.The master budget is an important tool for management to use in planning and decision-making, as it provides a comprehensive view of the organization's financial position and performance.
It is also useful in tracking actual financial results against the budgeted amounts, allowing management to identify any areas where corrective action may be necessary. Overall, the master budget serves as a critical component of an organization's financial planning and control processes. The correct answer is D. master budget.
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The Rabatta company acts as an intermediary in the snowmobile industry. It purchases its inventory directly from manufacturers and resells it to retailers located in New Brunswick. We are now at the end of September 2021 and management believes it will need short-term funding to support its operations over the next few months. Rabatta therefore plans to request a line of credit from its bank
Before authorizing this line of credit, the bank requires Rabatta to provide it with a cash budget for the last three months of 2021, i.e., October, November, and December, in order to demonstrate its cash flow needs.
Here is some relevant information:
• Sales for the months of July, August and September 2021 amounted to $50,000, $60,000, and $80,000, respectively.
• Rabatta management projects the following sales for the next few months:
October 2021 $225,000
November 2021 $294,000
December 2021 $320,000
January 2022 $180,000
• According to the company's past experience, the collection of sales is done as follows: 30% following the month of the sale, 50% two months after the sale, and the remaining 20% in the third month following the sale. sale. All sales are made on credit to established customers.
• The cost of sales represents 80% of sales. Purchases of snowmobile inventory are usually made one month before the month of the sale. Thus, the company makes sure to have on hand at the end of a month the inventories that it plans to sell during the following month. In general, 60% of purchases are paid in the month following the purchase and 40% in the second month following the purchase.
• Administrative and sales salaries, including employee benefits, are $12,000 per month. Additionally, the company pays a 2% commission of sales to sellers. This commission is paid in the month of the sale.
• Rabatta plans to purchase a service truck in October at a cost of $35,000. This amount will be financed by the concessionaire. Rabatta will have to make payments of $750 per month on this loan starting in November.
• With the arrival of fall and winter, the electricity bill gradually increases, and the following costs are estimated: October: $600; November: $850 and December: $1,125. These fees are paid the month following the month of use. Electricity usage for the month of September was $425.
• Other business operating expenses remain at $3,000 per month.
• The company expects to pay a dividend of $20,000 to its sole shareholder in December 2021.
• Depreciation expense is $4,000 per month.
• The company has a cash balance of $65,000 as of September 30, 2021.
• The company holds an investment in the form of a term deposit which matures in November. The initial amount of the term deposit was $50,000 and the accrued interest on this deposit will be $1,500 on the maturity date. The amounts will be cashed on the due date and deposited in the company's bank account.
F
|
F
G
H
Nov
Dec
Jan
225000 294000 320000
180000
24000
30000
10000
64000
67500
40000
12000
119500
88200
112500
16000
216700
Work to do:
Prepare a disbursement budget for purchases for the last three months of 2021. (You must demonstrate the details of all your calculations)
The disbursement budget for purchases for the last three months of 2021 is as follows:
October: $188,000
November: $282,000
December: $272,000
This budget takes into account the cost of goods sold, purchases of inventory, and the payment schedule for these purchases. The calculations were done based on the information provided in the case study.
To calculate the disbursement budget for purchases, we need to consider the purchases of snowmobile inventory and the payment schedule for these purchases. Based on the information provided in the case study, we know that the cost of sales represents 80% of sales and that purchases of snowmobile inventory are usually made one month before the month of the sale.
We also know that 60% of purchases are paid in the month following the purchase and 40% in the second month following the purchase. Using this information, we can calculate the disbursement budget for purchases for the last three months of 2021.
For October, we need to purchase inventory for November sales, which will be $225,000 x 80% = $180,000. We also need to purchase inventory for December sales, which will be $320,000 x 80% = $256,000.
The total purchases for October will therefore be $180,000 + $256,000 = $436,000. Of this amount, 60% will be paid in November and 40% in December. Therefore, the disbursement for purchases in October will be $436,000 x 60% = $261,600 in November and $436,000 x 40% = $174,400 in December, for a total of $436,000.
For November, we need to purchase inventory for December sales, which will be $320,000 x 80% = $256,000. The total purchases for November will therefore be $256,000. Of this amount, 60% will be paid in December and 40% in January. Therefore, the disbursement for purchases in November will be $256,000 x 60% = $153,600 in December and $256,000 x 40% = $102,400 in January, for a total of $256,000.
For December, there are no purchases of inventory to consider. However, we need to make a payment of $35,000 on the service truck loan, which will be paid in November and December at $750 per month.
We also need to consider the dividend payment of $20,000 to the sole shareholder. Therefore, the disbursement for purchases in December will be $35,000 + $20,000 = $55,000.
Overall, the disbursement budget for purchases for the last three months of 2021 is as follows:
October: $188,000
November: $282,000
December: $272,000
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Exercise 5 (5 points)
You have a portfolio consisting of two stocks A and B, according to portfolio theory:
(a) on what would the risk of this portfolio depend?
b) under what condition would your portfolio reach the maximum risk level?
c) under what condition would your portfolio reach the minimum risk level?
Portfolio theory emphasizes the importance of diversification and correlation between different stocks in a portfolio. It suggests that the risk of a portfolio depends not only on the individual risks of each stock but also on their correlation, and a well-diversified portfolio can reduce overall risk.
(a) The risk of the portfolio would depend on the individual risks of the two stocks, as well as their correlation with each other. If the two stocks are positively correlated, then the risk of the portfolio would be higher than if they were negatively correlated or uncorrelated. Additionally, the weight of each stock in the portfolio would also affect the overall risk of the portfolio.
(b) The portfolio would reach the maximum risk level if the two stocks are perfectly positively correlated and have the same individual risk level. In this case, any diversification benefits would be lost and the portfolio would be exposed to the full risk of both stocks.
(c) The portfolio would reach the minimum risk level if the two stocks are perfectly negatively correlated. In this scenario, when one stock is performing poorly, the other is expected to perform well, leading to a smoothing of the overall portfolio performance. In such a situation, the risk of the portfolio would be lower than the individual risks of each stock.
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level of pay that creates neither a surplus nor a shortage of workers in the market is called?
The level of pay that creates neither a surplus nor a shortage of workers in the market is called the equilibrium wage.
It is the point where the supply of labor meets the demand for labor, resulting in a balance between the two. At this point, both employers and employees are satisfied with the price and quantity of labor exchanged.
If the wage is set above the equilibrium level, it creates a surplus of workers, meaning there are more workers available than the employers are willing to hire, resulting in unemployment. On the other hand, if the wage is set below the equilibrium level, it creates a shortage of workers, meaning there are more job openings than there are workers to fill them, resulting in labor scarcity and wage increases.
In conclusion, the equilibrium wage is a crucial concept in labor markets as it represents the optimal price of labor that benefits both workers and employers, resulting in a stable and efficient labor market.
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If a credit card pays 5% interest compounded quarterly, what is the effective annual interest rate? a. 6% b.5% c.5.4% O d. 5.09%
The effective annual interest rate is the interest rate that is earned on an investment over a year when the interest is compounded more than once a year. In this case, credit card pays 5% interest compounded quarterly. Effective annual interest rate is 5.09%, Correct answer is option D
To calculate the effective annual interest rate, we need to use the formula: Effective annual interest rate = (1 + (nominal interest rate / number of compounding periods)).number of compounding periods - 1. In this case, the nominal interest rate is 5% and the number of compounding periods is 4 (since interest is compounded quarterly). So, we can plug these values into the formula:
Effective annual interest rate =[tex](1 + (0.05 / 4))^4 - 1[/tex]. Simplifying this expression gives us: Effective annual interest rate = 1.0509 - 1, Effective annual interest rate = 0.0509 or 5.09%
This means that if you invest $1000 on this credit card, you will earn 5.09% interest on it in a year. It's important to note that the effective annual interest rate takes into account the effect of compounding, which means that the interest you earn will be reinvested and earn interest itself. Therefore, the answer is option d.
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if $13,500 is invested at 8% compounded quarterly, how much will this investment be worth in 17 years? round your answer to two decimal places.
After 17 years, your investment will be worth approximately $39,697.27 when rounded to two decimal places.
How to calculate the value of your investmentTo find the value of your investment after 17 years, you can use the formula for compound interest:
A = P(1 + r/n)^(nt)
where A is the final amount, P is the principal ($13,500), r is the annual interest rate (0.08), n is the number of compounding periods per year (4 for quarterly), and t is the time in years (17).
Using this formula, you can calculate the final value of your investment as follows:
A = 13,500(1 + 0.08/4)^(4*17)
A = 13,500(1 + 0.02)^68
A = 13,500(1.02)^68
A ≈ 39,697.27
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why was electricity the most important power source for the second industrial revolution? group of answer choices electrical power generation plants were pollution-free. britain was rich in coal, so it did not have to rely on foreign supplies to power its factories. some new industries, such as the iron industry, were dependent solely on electricity. factories could be located near concentrations of workers and production costs were lower
The most important power source for the second industrial revolution was electricity because "factories could be located near concentrations of workers, and production costs were lower" (Option d).
With the availability of electricity, factories no longer needed to be located near rivers or coalfields for power. Instead, they could be built in urban areas closer to a concentration of workers, which made it easier to recruit and manage employees. Additionally, electrical power could be transmitted over longer distances, allowing factories to be located farther away from raw materials and closer to markets.
Furthermore, the use of electricity in manufacturing processes improved efficiency and productivity, as machines could be powered continuously and uniformly, leading to greater output and reduced costs. This was particularly important in new industries such as the iron industry, where electricity was the only viable power source for certain manufacturing processes.
Finally, the development of electrical power generation plants meant that businesses could rely on a more consistent and reliable source of power compared to earlier methods such as steam engines. This allowed for smoother production processes and fewer interruptions due to power outages.
Overall, the widespread adoption of electricity in the second industrial revolution was a significant factor in the growth and success of manufacturing industries during that time.
Option d is answer.
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