The Free Cash Flow model has the following advantage over the Dividend Growth model: In the case of variable growth, it does not require the calculation of any horizon value. O It can be applied even if growth rates are unknown. It can be applied to companies with variable growth in the initial years that eventually settle down to a fixed rate of growth for the long term. O It can be applied to divisions of companies. O It does not require any forecasting.
Q: How can companies use market research to validate and refine their value propositions?
A: Market research serves as a vital tool for companies seeking to validate and refine their value…
Q: UCLp 0.0332 (enter your response as a number between 0 and 1, rounded to four decimal places). LCLp…
A: where: is the average proportion defective which is 2% or 0.02z is the z-value for the desired…
Q: A seafood distribution company specializes in delivering fresh lobsters from their harvesting sites…
A: Find the given details below:
Q: After the physical inventory is completed, theo unit costs are determined by dividing the quantities…
A: Financial management is the aspect of management that is concerned with or manages all the…
Q: How does international operations management contribute to overall business strategy and…
A: International Operations Management (IOM) is the discipline that manages international corporate…
Q: Hi! I need a little help with D. I can't figure out how to calculate the efficiency. Can you explain…
A: The efficiency of the balanced line is approximately 63.89%.Explanation:1. Total Task Times: This is…
Q: Activity Predecessors 1 Description Duration Start job 1 2 1 Relocate electric 6 3 1 4 3 5 4 6 4 7…
A: To calculate the Latest Finish (LF) time for each activity, we'll start by drawing the Activity on…
Q: d iscuss the role of supervisors or managers in conducting traditional performance reviews.
A: Performance evaluations are essential to an employee's professional development in an organisation…
Q: Customers enter the camera department of a store at an average rate of six per hour. The department…
A: The given problem corresponds to the M/M/1 queuing model which is a single-server queuing system…
Q: Asap True or False: In a perfectly competitive market, firms have significant market power..
A: FalseExplanation:Companies do not have a considerable amount of market power in a market market that…
Q: The following are monthly actual and forecast demand levels for May through December for units of a…
A: A tracking signal is a tool utilized in statistics and management science to observe forecasts and…
Q: Fix-Em-Up Industries restores classic cars. Their chairman wants to create a project netwo diagram…
A: Project management is the branch of management that deals with organizing and overseeing the…
Q: If the forecast and the actual demand in the year 2021 was 600 and 700 respectively, what is the…
A: The objective of the question is to calculate the forecast for the year 2022 using the naive…
Q: d CE Additional Algo 5-11 Attrition Losses and Yields A process has three resources and two types of…
A: Answers are in attachment. Explanation:
Q: Develop a 1 year periodized program for a Major League Baseball population. Use the traditional…
A: Major League Baseball (MLB) - is a professional baseball league in North America, consisting of 30…
Q: How does outsourcing affect a company's design capacity calculations?
A: In the context of capacity planning, an organization's design capacity is its maximum ability to…
Q: Peter’s Paper Clips uses a three-stage production process: cutting wire to prescribed lengths, inner…
A: Cutting capacity = 220 pieces per minuteInner bending capacity = 230 pieces per minuteOuter bending…
Q: NYC Real Estate is purchasing an old office building in order to renovate it. The renovation project…
A:
Q: Please help with correct answers in details: step by step as last submission were given incorrect…
A: B) ANSWER FOR QUESTION BTo develop the equation with dummy variables for seasonal effects, you can…
Q: 13. The Bi-Product Company produces two products (A and B) that are similar in terms of labor con-…
A: Aggregate plans show output rates, workforce levels, and inventory in accordance with demand and…
Q: Macy's has decided to hire 1,000 additional sale people from October 1st - January 31st to help with…
A: The answer is: a. controllable variableExplanation:The answer is: a. controllable variableHere's…
Q: 2.15 The opening backlog is 900 units. Forecast demand is shown in the following. Calculate the…
A: The opening backlog = 900 units Projected ending backlog = 200 units
Q: Strategic management is the process of formulating, implementing, and evaluating long-term…
A: Strategic management, in other words, refers to a total of all ways including planning,…
Q: (b) Solve the linear program formulated in part (a). How many service facilities are required? Where…
A: Prepare an excel sheet as shown below:Note that in excel the colored values represents the cities…
Q: A department store needs to hire holiday season sales staff for their store. To cover all the…
A: Linear programming helps us find the optimal solution/best outcome, given the constraints. Integer…
Q: RBMC Industry manufactures a special printing according to customer specifications with respect to…
A: (a) Cost Model Formulation:Cost of production: This is the cost incurred by the owner for producing…
Q: The owner of Artisanal Chips etc. produces three flavors of artisanal corn chips marketed at new…
A: The information regarding production of 3 products: pumpkin (P), chipotle adobo (C) and basement (B)…
Q: The following time series represents the number of automobiles sold by a car dealership each of the…
A: a.) The correct time series plot for the given data is the third plot.The time series plot shows a…
Q: A company manufactures plastic bottles, buckets, and cups. The profit units are $10 for a plastic…
A: The Simplex Method or Simplex Algorithm is used for calculating the optimal solution to the linear…
Q: Given the following information set up the problem in a transportation table and solve for the…
A: Find the given details below:
Q: Examine the impact of occupational diseases, stress and communicable diseases to the health and…
A: Maintaining workers' health and safety in today's changing work conditions is critical to the…
Q: Hale's TV Production is considering producing a pilot for a comedy series in the hope of selling it…
A: The detailed solution is provided below.Explanation: 2) WHAT IS THE RECOMMENDED DECISION IF AGENCY…
Q: Explain, How do organizations manage scheduling conflicts between different departments or…
A: Operations planning entails scheduling of resources, tasks, and work to be completed within the…
Q: Your international business is an Oil Company located and operating in Saudi Arabia 1a. Outline…
A: The objective of the question is to outline the organizational structure for an international oil…
Q: How do organizations measure and track the effectiveness of their Quality Assurance programs?
A: The goal of quality assurance as a business idea is to provide value for customers by removing…
Q: How do organizations manage excess and obsolete inventory effectively?
A: Inventory management is an essential part of supply chain management. It involves keeping track of…
Q: Using the information below answer the following questions a) What is the bottleneck in the process…
A: There are 4 products produced by a factory as shown below:Factory runs one 8-hour shift per day per…
Q: Use the relative-aggregate-scores approach to compare the two motherboard assembly technology…
A: The relative-aggregate-score method is a decision-making approach used to compare alternatives based…
Q: Identify and discuss by completing a thorough analysis of Tech Products Inc. one (1) internal tool…
A: Business environment is the aspect that deals with the study of the factors or components that…
Q: The multifaceted challenges an organization faces when contemplating international ventures are not…
A: The objective of the question is to analyze the various challenges an organization might face when…
Q: Discuss the advantages of using work sampling as a method of work measurement.
A: A Work Measurement Study uses an approaches to systematically determine the work content and…
Q: Activity Predecessors 1 Description Duration Start job 1 2 1 Relocate electric 6 3 1 4 3 5 4 6 4 7…
A: To determine the earliest finish time (EF) for each activity, we need to compute the forward pass in…
Q: a.What additional annual cost is the shop incurring by staying with this order size? (Round your…
A:
Q: Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care…
A: The objective of the question is to understand the various pressures that decision makers in public…
Q: Question 1. Narrow the focus of each of the following broad topics so that they each signal the use…
A: The objective of the question is to narrow down the broad topics using the Analysis by Division…
Q: There is a love triangle between two females and one male in your plant and as the HR manager you…
A: Ensuring the well-being and peace of our workplace is my responsibility as our organization's HR…
Q: Please help with correct answers in details: Step by step Suppose these data show the number of…
A: Compute four-week and five-week moving averages for the time series.WeekSales (1000s of…
Q: Help me calculate the fixed production cost for option 1
A: The objective of the question is to calculate the fixed production cost for option 1, which involves…
Q: In the context of operation management How can organizations address resistance to change during…
A: Enterprise Resource Planning (ERP) improves operations throughout a company by coordinating data…
Q: How does agile management support the concept of continuous delivery and frequent releases?
A: Agile project management is a flexible and collaborative methodology that is mostly used in software…
Step by step
Solved in 3 steps
- You are considering a 10-year investment project. At present, the expected cash flow each year is 10,000. Suppose, however, that each years cash flow is normally distributed with mean equal to last years actual cash flow and standard deviation 1000. For example, suppose that the actual cash flow in year 1 is 12,000. Then year 2 cash flow is normal with mean 12,000 and standard deviation 1000. Also, at the end of year 1, your best guess is that each later years expected cash flow will be 12,000. a. Estimate the mean and standard deviation of the NPV of this project. Assume that cash flows are discounted at a rate of 10% per year. b. Now assume that the project has an abandonment option. At the end of each year you can abandon the project for the value given in the file P11_60.xlsx. For example, suppose that year 1 cash flow is 4000. Then at the end of year 1, you expect cash flow for each remaining year to be 4000. This has an NPV of less than 62,000, so you should abandon the project and collect 62,000 at the end of year 1. Estimate the mean and standard deviation of the project with the abandonment option. How much would you pay for the abandonment option? (Hint: You can abandon a project at most once. So in year 5, for example, you abandon only if the sum of future expected NPVs is less than the year 5 abandonment value and the project has not yet been abandoned. Also, once you abandon the project, the actual cash flows for future years are zero. So in this case the future cash flows after abandonment should be zero in your model.)Assume the demand for a companys drug Wozac during the current year is 50,000, and assume demand will grow at 5% a year. If the company builds a plant that can produce x units of Wozac per year, it will cost 16x. Each unit of Wozac is sold for 3. Each unit of Wozac produced incurs a variable production cost of 0.20. It costs 0.40 per year to operate a unit of capacity. Determine how large a Wozac plant the company should build to maximize its expected profit over the next 10 years.Play Things is developing a new Lady Gaga doll. The company has made the following assumptions: The doll will sell for a random number of years from 1 to 10. Each of these 10 possibilities is equally likely. At the beginning of year 1, the potential market for the doll is two million. The potential market grows by an average of 4% per year. The company is 95% sure that the growth in the potential market during any year will be between 2.5% and 5.5%. It uses a normal distribution to model this. The company believes its share of the potential market during year 1 will be at worst 30%, most likely 50%, and at best 60%. It uses a triangular distribution to model this. The variable cost of producing a doll during year 1 has a triangular distribution with parameters 15, 17, and 20. The current selling price is 45. Each year, the variable cost of producing the doll will increase by an amount that is triangularly distributed with parameters 2.5%, 3%, and 3.5%. You can assume that once this change is generated, it will be the same for each year. You can also assume that the company will change its selling price by the same percentage each year. The fixed cost of developing the doll (which is incurred right away, at time 0) has a triangular distribution with parameters 5 million, 7.5 million, and 12 million. Right now there is one competitor in the market. During each year that begins with four or fewer competitors, there is a 25% chance that a new competitor will enter the market. Year t sales (for t 1) are determined as follows. Suppose that at the end of year t 1, n competitors are present (including Play Things). Then during year t, a fraction 0.9 0.1n of the company's loyal customers (last year's purchasers) will buy a doll from Play Things this year, and a fraction 0.2 0.04n of customers currently in the market ho did not purchase a doll last year will purchase a doll from Play Things this year. Adding these two provides the mean sales for this year. Then the actual sales this year is normally distributed with this mean and standard deviation equal to 7.5% of the mean. a. Use @RISK to estimate the expected NPV of this project. b. Use the percentiles in @ RISKs output to find an interval such that you are 95% certain that the companys actual NPV will be within this interval.
- Big Hit Video must determine how many copies of a new video to purchase. Assume that the companys goal is to purchase a number of copies that maximizes its expected profit from the video during the next year. Describe how you would use simulation to shed light on this problem. Assume that each time a video is rented, it is rented for one day.A company manufacturers a product in the United States and sells it in England. The unit cost of manufacturing is 50. The current exchange rate (dollars per pound) is 1.221. The demand function, which indicates how many units the company can sell in England as a function of price (in pounds) is of the power type, with constant 27556759 and exponent 2.4. a. Develop a model for the companys profit (in dollars) as a function of the price it charges (in pounds). Then use a data table to find the profit-maximizing price to the nearest pound. b. If the exchange rate varies from its current value, does the profit-maximizing price increase or decrease? Does the maximum profit increase or decrease?The IRR is the discount rate r that makes a project have an NPV of 0. You can find IRR in Excel with the built-in IRR function, using the syntax =IRR(range of cash flows). However, it can be tricky. In fact, if the IRR is not near 10%, this function might not find an answer, and you would get an error message. Then you must try the syntax =IRR(range of cash flows, guess), where guess" is your best guess for the IRR. It is best to try a range of guesses (say, 90% to 100%). Find the IRR of the project described in Problem 34. 34. Consider a project with the following cash flows: year 1, 400; year 2, 200; year 3, 600; year 4, 900; year 5, 1000; year 6, 250; year 7, 230. Assume a discount rate of 15% per year. a. Find the projects NPV if cash flows occur at the ends of the respective years. b. Find the projects NPV if cash flows occur at the beginnings of the respective years. c. Find the projects NPV if cash flows occur at the middles of the respective years.
- It is January 1 of year 0, and Merck is trying to determine whether to continue development of a new drug. The following information is relevant. You can assume that all cash flows occur at the ends of the respective years. Clinical trials (the trials where the drug is tested on humans) are equally likely to be completed in year 1 or 2. There is an 80% chance that clinical trials will succeed. If these trials fail, the FDA will not allow the drug to be marketed. The cost of clinical trials is assumed to follow a triangular distribution with best case 100 million, most likely case 150 million, and worst case 250 million. Clinical trial costs are incurred at the end of the year clinical trials are completed. If clinical trials succeed, the drug will be sold for five years, earning a profit of 6 per unit sold. If clinical trials succeed, a plant will be built during the same year trials are completed. The cost of the plant is assumed to follow a triangular distribution with best case 1 billion, most likely case 1.5 billion, and worst case 2.5 billion. The plant cost will be depreciated on a straight-line basis during the five years of sales. Sales begin the year after successful clinical trials. Of course, if the clinical trials fail, there are no sales. During the first year of sales, Merck believe sales will be between 100 million and 200 million units. Sales of 140 million units are assumed to be three times as likely as sales of 120 million units, and sales of 160 million units are assumed to be twice as likely as sales of 120 million units. Merck assumes that for years 2 to 5 that the drug is on the market, the growth rate will be the same each year. The annual growth in sales will be between 5% and 15%. There is a 25% chance that the annual growth will be 7% or less, a 50% chance that it will be 9% or less, and a 75% chance that it will be 12% or less. Cash flows are discounted 15% per year, and the tax rate is 40%. Use simulation to model Mercks situation. Based on the simulation output, would you recommend that Merck continue developing? Explain your reasoning. What are the three key drivers of the projects NPV? (Hint: The way the uncertainty about the first year sales is stated suggests using the General distribution, implemented with the RISKGENERAL function. Similarly, the way the uncertainty about the annual growth rate is stated suggests using the Cumul distribution, implemented with the RISKCUMUL function. Look these functions up in @RISKs online help.)A martingale betting strategy works as follows. You begin with a certain amount of money and repeatedly play a game in which you have a 40% chance of winning any bet. In the first game, you bet 1. From then on, every time you win a bet, you bet 1 the next time. Each time you lose, you double your previous bet. Currently you have 63. Assuming you have unlimited credit, so that you can bet more money than you have, use simulation to estimate the profit or loss you will have after playing the game 50 times.What-If Analysis As the management accountant for the Tyson Company you have been askedto construct a financial planning model for collection of accounts receivable and then to performa what-if analysis in terms of the assumption regarding estimated uncollectible accounts. You areprovided with the following information:Collection Pattern for Credit Sales: 65% of the company’s credit sales are collected in the monthof sale, 30% in the month following the month of sale, and 5% are uncollectible.Credit Sales: January 2019, $100,000; February 2019, $120,000; March 2019, $110,000.Required1. Generate a spreadsheet model regarding estimated bad debts expense under the following assumptionsregarding the rate of uncollectible accounts: 1%, 3%, 5% (base case), and 8%. Prepare an estimate of baddebts expense for each of three months, January through March, and for the quarter as a whole.2. What is the value to Tyson Company of creating a model and then performing the what-if analysis?
- Assume a company's Income Statement for Year 12 is as follows: Year 12 (in 000s) Income Statement Data Net Revenues from Footwear Sales $ 580,000 370,000 40,000 75,000 15,000 90,000 Cost of Pairs Sold Warehouse Expenses Marketing Expenses Administrative Expenses Operating Profit (Loss) Interest Income (Expense) Pre-tax Profit (Loss) Income Taxes Net Profit (Loss) (15,000) 75,000 22,500 $ 52,500 Based on the above income statement data and assuming the company has 20 million shares of common stock outstanding , the company's operating profit margin and EPS were Copyright O by Glo-Bus Software, Inc. Capying, distributing, ar 3rd party website posting isexpressly prohibited and constitutes copyright vialation. 15.52% and $4.50. O 9.05% and $3.75. 13.79% and $1.75. O 12.93% and $3.75. O 15.52% and $2.63.To better plan for future growth of the restaurant, Karen needs to develop a system that will enable her to forecast food and beverage sales by month for up to one year in advance. Table shows the value of food and beverage sales ($1000s) for the first three years of operation. Food and Beverage Sales for the Vintage Restaurant ($1000s) Month First Year Second Year Third Year January 242 263 282 February 235 238 255 March 232 247 265 April 178 193 205 May 184 193 210 June 140 149 160 July 145 157 166 August 152 161 174 September 110 122 126 October 130 130 148 November 152 167 173 December 206 230 235 Managerial Report Perform an analysis of the sales data for the Vintage Restaurant. Prepare a report for Karen that summarizes your findings, forecasts, and recommendations. Include the following: A time series plot. Comment on the underlying pattern in the time series.…A restaurant borrows $15,200 from a local bank for 10 months. The local bank charges simple interest at an annual rate of 4.55% for this loan. Assume each month is 112 of a year. Answer each part below.Do not round any intermediate computations, and round your final answers to the nearest cent. If necessary, refer to the list of financial formulas . (a) Find the interest that will be owed after 10 months. $ (b) Assuming the restaurant doesn't make any payments, find the amount owed after 10 months.