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Finance

Choose the economical generator in the given situations.

A portable generator is needed at a remote construction site. Two alternatives are being considered. Their annual fixed costs and operating and maintenance costs per hour are shown in the table below. The contractor runs three 8-hour shifts per day for 250 working days per year Generator 1 Fixed cost per year $4000 O&M

Comparative Present Worth of Each of the Three Alternatives

Castille Pharmaceuticals (CP) currently leases testing equipment for use during the production of a product at a cost of $61,000 annually that includes all maintenance expenses. The product line produced on the machine has revenues of $100,000 annually. Three options need to be evaluated. 1. Continuing to lease the present mac

Retirement Fund

Thomas is considering retiring and migrating to a rental property in the Virgin Islands. Thomas presently owns a home appraised at $595,000 with $300,000 remaining on the home loan. He has about $350,000 in savings right now. The Virgin Island rent will be $1,000 a month and he estimates that he and his wife can live on $3,000

Create a system for investing virtual money in the stock market.

Students have to initiate a 3 weeks investment simulation on the New York Stock Exchange. With a starting virtual budget of $10,000, they must build their own information system that will be used as a support to take operational decisions: buying or selling shares from 5 American companies. Each decision involves a cost for b

Evaluate continuous variables.

Consider the model Y = B_0 + B_1X_1+B_2X_2+e, e ~ N(0, σ^2) where the ‘xs are all continuous variables. You also have data on a qualitative variable denoted d1 for each observation, where d1 = 1 if the observation belongs to group 1, and zero otherwise. 1) Assume you want to set an empirical model to see the expected valu

Scrutinize a cash conversion cycle.

The Phoenix Corporation is interested in examining its cash conversion cycle. Suppose a Phoenix manager has assembled the following data for your use: $2.75 million Average Inventory $1.05 million Average Accounts receivable $0.60 million Average Accounts payable $0.45 million Wages, benefits, and payroll taxes payable $7

Corporate Finance Discussion

Integrative Multiple leverage measures and prediction Carolina Fastener, Inc., makes a patented marine bulkhead latch that wholesales for $ 6.00. Each latch has variable operating costs of $ 3.50. Fixed operating costs are $ 50,000 per year. The firm pays $ 13,000 interest and preferred dividends of $ 7,000 per year. At this poi

universal concerns of financial management

The universal concerns of financial management are controlling costs, ability to have available cash to pay obligations, ability to access capital for expansion and the ability to conserve the asset base of the organization. Give an example of a company that has failed in at least one of these universal concerns. Further disc

macro short answers

1. Some economists believe that the financial crisis we have been experiencing during the last years is the result of a fundamental change in attitude of the American population over time. In other words, during the 50s and 60s Americans were hard working, conservative, lenders and exporters. Today, we would like to work less fo

CAPM

Suppose the rate of return on short-term government securities (perceived to be risk-free) is 5%. Suppose also that the expected rate of return required by the market for a portfolio with a beta of 1 is 12%. According to the CAPM 1. What is the expected rate of return on the market portfolio? 2. Suppose you consider buyi

Financial Forecasting Problems

Please help with the following problem. Gainesville Surgicenter Inc. is a large, ambulatory surgery center owned by a group practice of surgeons in Gainesville, Florida. The 2006 financial statements for the firm are shown below: (***see attached excel file***) a. Assume that the company was operating at full capacity

Finance 1

1. The accompanying Excel file provides you with monthly price and dividend data for CVS Caremark (Ticker symbol: CVS) from Yahoo Finance. (If you want to see where the data came from, go to Yahoo Finance. Type in the ticker, CVS. Then, click historical prices.) 2. Expand the spreadsheet and compute monthly HPRs for each of

Marginal Cost

Retirement Planning Services.com is a wholesale producer of standardized retirement plans for high net worth individuals. These plans are produced and e-mailed to financial planners who incorporate them in their client presentations. The following relation exists between the firm's output and total production costs in this highl

Project comparison is attained.

43. Matt is analyzing two mutually exclusive projects of similar size and has prepared the following data. Both projects have 5 year lives. Project A Project B NPV $15.090 $14,693 Payback period 2.76 years 2.51

Compounding interests

25. The stated rate of interest is 10%. Which form of compounding will give the highest effective rate of interest? A. annual compounding B. monthly compounding C. daily compounding D. continuous compounding E. It is impossible to tell without knowing the term of the loan.

Determining the optimal level of parties for society

In the accompanying figure, the number of parties that Cassanova gives per month is measured on the horizontal axis, and dollars are measured on the vertical. MCp is the marginal cost of providing parties and MBp is Cassanova's marginal benefit schedule from having parties. a. Graphically, show how many parties Cassanova will h

Earnings per Share.

Need help to answer sample problem . Please provide a detail working of answers. Beckett, Inc., has no debt outstanding and a total market value of $ 128,000. Earnings before interest and taxes, EBIT, are projected to be $ 12,000 if economic conditions are normal. If there is strong expansion in the economy, then EBIT will be

Memorandum: Tax Efficient Financial Planning

Details: Your managing director asks if you can participate in a seminar that the firm is doing on tax efficient financial planning. He would like you to send him, in memo form, the various types of vehicles that can be used by clients to reduce the various kinds if taxation. Prepare a memo to the managing director that expla

Value Line Geometric Index

Geometric Indexes. We have seen the importance of geometric returns through time. A geometric index is formed across different stocks at a particular point in time, such as a day. Constructing a portfolio that exactly replicates a geometric index is thus impossible. Given this, why would you want to use a geometric index? In oth

Hypothesis Testing

# 1 A study was designed to compare the effects of drug A and drug B on bone mineral density (BMD). One of the outcome measures was the percent increase in BMD at 12 months. Drug A produced a significantly higher percent change (4.8 percent) in BMD than drug B (2.8) with a p value < .001. a) What is the variable o

Opportunity Costs

Opportunity Costs. Two graduate business students are considering opening a full-service car wash in Greenville, North Carolina, after graduation. This is an alternative to employment with a local manufacturing firm where they would each earn $70,000 per year. A fully equipped facility can be leased at a cost of $35,000 for the

Calculation of full costs and selling prices

A company manufactures refrigrators for domestic use .There are three models: Lo ,Mid and Hi.The Models ,their quality and their price are aimed at different markets..Product costs arecomputed on ablanket (business-wide)overheadrate basis using a labour-hour method .Prices as a general rule areset based on cost plus 20 per cent

Theory of cost

According to the theory of cost, specialization in the use of variable resources in the short-run results initially in: a) decreasing returns, and declining average and marginal costs b) increasing returns, and declining average and marginal costs c) increasing returns, and increasing average and marginal costs d)

Rank the sensitivity

Rank the sensitivity of the following from most sensitive to an interest rate change to the least sensitive. 1. 8% coupon, non callable 20 year maturity, par bond 2. 9% coupon, currently callable 20 year maturity, premium bond 3. zero coupon, 30 year maturity bond

Help with explaining credits and debits

My uncle has ran a motorcycle shop. He has decided to computerize his records and has asked me to explain the basics of accounting to him so that he can enter his data into his accounting software. 1. Explain to him the rules of debits and credits for the balance sheet and income statement. 2. Provide examples from the manufac

Investment - portfolios

Consider a risky portfolio. The end of year cash flow derived from the portfolio will either be $50 000 or $150 000, with equal probabilities of 0.5 . The alternative riskless investment in t-bills pays 5%. 1.If you require a risk premium of 10%, how much will you be willing to pay for the portfolio? 2.Suppose the portfol

Corporate Valuation and Governance

Please see attached spreadsheet. Zieber Corporation's 2010 financial statements are shown below. Forecast Zeiber's 2011 income statement and balance sheets. Use the following assumptions: (1) Sales grow by 6%. (2) The ratios of expenses to sales, depreciation to fixed assets, cash to sales, accounts receivable to sales, and in

Economics Problem - Price Probability

A firm has decided to invest in a piece of land. Management has estimated that the land can be sold in 5 years for the following possible prices: Price Probability 10,000 .20 15,000 .30 20,000 .40 25,000 .10 a. Determine the expected selling price

Determine income for the month

ShoppingKart, Inc is a supermarket having thee operating departments. An income statement for the most recent month of operations is listed below. General Meat Produce Total Sales $50,000 $40,000 $10,000 $100,000 Variable Costs 30,000 16,000 5,000 51,000 Contribution Margin 20,000 24,000 5,000 49,000 Fixed Costs: D