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Warrant Pricing

Problem Review - Breakeven Pricing and Analysis

Vineet, If you are interested. I have entered the numbers for the attached problems. I would like to have you review for accuracy and corrections. In addition, I would like your take on question 2 of the attached word document. As always thanks for your assistance. B Breakeven Pricing and Analysis McCarthy Co

Pricing Strategy

Please write a Pricing Strategy for the following product: Our product is a waterproof watch that acts as a heart rate monitor. There are several of these on the market, but none that sync with the iPod. This product would also have several features for the outdoor athlete, including a UV monitor and the ability to track ca


(10). Generally, compensation arrangements do not determine: (a). Degree & timing of the cost responsibility assumed by the suppliers, (b). Amount of profit or fee available to the supplier, (c). Capability of the supplier with respect to quality, (d). Motivational implications of the fee portion of the compensation


(9). Several potential benefits exist when a buying firm pays for and takes title to special tooling? Which is not one of the potential benefits? (a). The buying firm gains greater control, (b). Insurance costs are lower, (c). Analysis of production costs is easier, (d). Labor learning curve effect is reduced.

Transfer Pricing - Cameo Products

I need help to solve this problem, thank you. Transfer Pricing Cameo Products has two divisions: Office Products and Furniture. Divisional manager are encouraged to maximize ROI at their respective divisions. Mangers are free to decide whether goods will be transferred internally and to determine the prices at which transf

Comet Airlines warrants: What is the intrinsic value?

22) Mr. John Hailey has $1000 to invest in the market. He is considering buying 50 shares of Comet Airlines at $20 per share. His broker suggests that he may wish to consider purchasing warrants instead. The warrants are selling for $5, and each warrant allows him to purchase one share of comet Airlines common stock at $18 pe


Using marketing tactics and legal threats, IBM is actively trying to keep mail order retailers from selling its line of personal computers. IBM earns the same wholesale price regardless of whether its products are sold be a mail order or by a full-service retailer. Why then would IBM want to discourage mail order sales?


Evaluate the following statement: Antitrust laws punish companies, not individuals. So long as you prove that you are following company policy, you are not personally subject to prosecution for pricing decisions. **Need a paragraph or two**

Pricing Discount Legality

A mail order company has begun to sell your prestige luggage at a 30% discount to the consternation of department stores that sell it at list price. You refuse to fill the mail order company's next order, explaining that you no longer wish to have that company sell your product. Is this practice illegal or legal? Explain your

Pricing product services

Some products and services are widely perceived as commodities. Still some companies build sustainable product advantages for even those products. How do they do it? Cite at least two examples

Pricing Problem

While airlines use segmented pricing strategies to charge business travelers more, most hotels actually give "corporate discounts" to business guests. Can you explain this anomaly?

Pricing problem

***Just need about a paragraph answer...Thanks! Steinway, a tiny but well regarded New York piano maker in the 1850"s grew quickly after Doretta Steinway, the founder's daughter, got the idea of offering free piano lessons with the sale of each piano. Can you explain this as a segmented pricing tactic? What are the segmen


Many local rental car agencies rent late model cars at substantially lower prices than national companies such as Hertz or Avis. Despite their higher prices, the national companies still retain most of the market. Explain why most renters patronize the national car rental companies despite their higher prices. How have the natio

Walking away from a business

At what point should a company "walk away from the business?" Should a company always strive to win every bid and avoid losing business?

Pricing for Rental Rates

Despite the fact that rental rates for commercial space and labor costs are generally higher in big cities than small towns; the prices of many products - such as electronics and clothing - are higher in small towns than in large cities. Can you explain this?

Eager Pizzas: transfer pricing method, performance evaluation system, pricing

In February 2009, you started as Group Operational Manager with Eager Pizzas; an organisation that operates a chain of 24-Hour Cooked Pizza Outlets in Australia, Singapore, Hong Kong, Malaysia, India, Fiji, South African, and New Zealand. The organisation divides its operations geographically into strategic business units (SBUs

Product Pricing and Profit Analysis

Freedom, Inc., management had formed cost studies and projected the following annual cost based on 40,000 units of production and sales: total annual cost % of variable portion of total annual cost direct material $400,000

A) How many shares of stock and how many warrants can Ms Michaels purchase? b) Suppose Ms. Michaels purchased the stock, held it 1 year, and then sold it for $60 share. What total gain would she realize, ignoring brokerage fees and taxes? c) Ignoring brokerage fees and taxes, what would be her total gain if the market value of the warrants increased to $45 and she sold out? d) What benefits, if any, would the warrants provide?

Common stock versus warrant investment: Susan Michaels is evaluating the Burton Tool Company's common stock and warrants to choose the better investment. The firm's stock is currently selling for $50 per share; its warrants to purchase three shares of common stock at $45 per share are selling for $20. Ignoring transactions c

A Pricing Decision Exercise

Better understanding with attachment (sorry but thank you) Tree Top Company is in the process of setting a selling price for its newest model stunt kite, thlooper. The controller of Tree Top estimates variable cost per unit for the new model to be as follows: Direct materials $15.00 Direct l

Advantage of using budgeted costs for transfer pricing

Please help with the following problem. Provide explanations. 1-An advantage of using budgeted costs for transfer pricing among divisions is that: A. overall corporate profitability is usually higher. B. it usually provides a basis for optimal decision making. C. the divisions know the transfer price in advance.

Transfer Pricing problem(Intensive problem)

The Assembly Division of American car Company has offered to purchase 90,000 batteries from the electrical division for $100 per unit.At a normal volume of 250,000 batteries per year,production costs per battery are as follows: Direct materials $40 Direct labor 24 Variable factory ov

Pricing of Products

Select a product or service. Then select three different organizations that provide your selected product or service and compare the prices associated with your selected product or service. What is the difference between the prices among the different organizations? What is the rationale for this difference?

Cost-Plus Pricing

The Sterling Company, which manufactures office equipment, is ready to introduce a new line of portable copiers. The following copier data are available: Variable Manufacturing Cost: $200 Applied Fixed Manufacturing Cost: $90 Variable Selling and Administrative Cost: $60 Allo


Le'Fleur has two divisions: the Parfume Division and the Bottle Division. The Bottle Division produces containers that can be used by the Parfume Division. The Bottle Division's variable manufacturing cost is $1.80, shipping cost is $0.10 and the external sales price is $2.80. No shipping costs are incurred on sales to the Parfu

Stine Corporation

Stine Corporation produces a filter that has a per unit cost of $17. The company would like a 30% markup. Using cost-plus pricing, determine the per unit selling price.


Gilbert Equipment, SA a French transportation equipment manufacturer, is heavily decentralized. Each division head has full authority on all decisions regarding sales to internal or external customers. The Provence Division has always acquired a certain equipment component from the Normandy Division. However, when informed that

Bond Pricing and Refunding Analysis

Barton Simpson, the chief financial officer of Broadband, Inc. could hardly believe the change in interest rates that had taken place over the last few months. The interest rate on A2 rated bonds was now 6%. The $30 million, 15 year bond issue that his firm has outstanding was initially issued at 9% five years ago. Because