In the case of AAA Corporation applying Total Quality Management (TQM), the most likely type of change to be used is Evolutionary Change. TQM is a continuous improvement approach that focuses on making incremental changes and adjustments to processes and systems to enhance quality and customer satisfaction.
It involves ongoing evaluation, feedback, and improvement based on the principles of continuous learning and adaptation. Evolutionary change aligns with the philosophy of TQM, as it emphasizes gradual and continuous improvement rather than radical or revolutionary transformations.
Total Quality Management (TQM) is an approach that emphasizes continuous improvement, customer satisfaction, and involvement of all employees in the quality improvement process. It focuses on making incremental changes and adjustments to processes, systems, and behaviors within an organization to enhance quality and meet or exceed customer expectations.
Evolutionary change, in the context of TQM, refers to a gradual and continuous improvement process. It involves identifying areas for improvement, implementing small changes, monitoring the results, and making further adjustments based on feedback and data analysis. This type of change recognizes that achieving significant improvements in quality and organizational performance takes time and requires the involvement and commitment of all employees.
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IDX Technologies is a privately held developer of advanced security systems based in Chicago. As part of your business development strategy, in late 2013 you initiate discussions with IDX's founder about the possibility of acquiring the business at the end of 2013. Estimate the value of IDX per share using a discounted FCF approach and the following data:
• Debt: $29 million
• Excess cash: $108 million
• Shares outstanding: 50 million
• Expected FCF in 2014: $47 million
• Expected FCF in 2015: $52 million ·
• Future FCF growth rate beyond 2015: 6% ·
• Weighted-average cost of capital: 9.4%
The enterprise value in 2013 is $___ million (Round to the nearest integer.)
The equity value is $ ____ million. (Round to the nearest integer.)
The value of IDX per share is $____ million.(Round to the nearest cent.)
The enterprise value in 2013 is $595.75 million, the equity value is $674.75 million and the value of IDX per share is $13.50 million.
It is given that Debt: $29 million, Excess cash: $108 million, Shares outstanding: 50 million, Expected FCF in 2014: $47 million, Expected FCF in 2015: $52 million,Future FCF growth rate beyond 2015: 6%, Weighted-average cost of capital: 9.4% .
The formula for enterprise value is:
Enterprise value = Equity value + Debt – Excess cash
Calculating the enterprise value, we have,
Enterprise value = (50 × (47/(1 + 0.094)¹)) + (50 × (52/(1 + 0.094)²)) / (0.094 – 0.06)
Enterprise value = $595.75 million
The equity value is calculated as:
Equity value = Enterprise value – Debt + Excess cash
Equity value = $595.75 – $29 + $108 = $674.75 million
The value of IDX per share is calculated by dividing the equity value by the number of shares outstanding:
Value of IDX per share = $674.75 / 50 = $13.50 million
Therefore, the enterprise value in 2013 is $595.75 million, the equity value is $674.75 million and the value of IDX per share is $13.50 million.
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Farmex Inc. has preferred stock outstanding that is paying a dividend of $5.25 per share (per year). Investors expect Farmex to have no problem in paying these dividends each year. If investors have a required return of 7.9% for preferred stock of this risk level, what should be the value (or price) of the stock?
Answer:
The value or price of the preferred stock should be around $66.46.
Explanation:
This is determined by dividing the annual dividend of $5.25 by the required return rate of 7.9%. It represents the amount that investors are willing to pay for the stock based on the expected future dividends.
Mountain Equipment Co-op has just issued $500,000 in 10-year bonds. They are required to establish a sinking fund in order to save enough money to pay the bond redemption when it comes due.
How much must they deposit at the end of every six months into an account earning 12=4% in order to save the $500,000?
Mountain Equipment Co-op must deposit approximately $14,044.31 every six months to save $500,000 for bond redemption.
How much must Mountain Equipment Co-op deposit every six months to save $500,000 for bond redemption, considering a 10-year maturity and an interest rate of 12.4%?To calculate the amount Mountain Equipment Co-op must deposit at the end of every six months to save $500,000 for bond redemption, we can use the formula for the future value of an annuity:
Future Value = Payment ˣ [(1 + Interest Rate)^Number of Periods - 1] / Interest Rate
Given that the bonds have a 10-year maturity, and deposits are made every six months, the total number of periods is 10 ˣ 2 = 20.
Substituting the values into the formula:
$500,000 = Payment ˣ [(1 + 0.124)²⁰ - 1] / 0.124
Simplifying the equation:
Payment ˣ (1.124²⁰ - 1) / 0.124 = $500,000
Calculating this expression:
Payment ≈ $500,000 ˣ 0.124 / (1.124²⁰ - 1) ≈ $14,044.31
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You decide to incorporate mobility flexibility into your company's workspace because of changing workplace arrangements. How would you incorporate mobility flexibility at your firm? Name a sector that practices similar flexibility
In order to corporate mobility flexibility into a company's workspace because of changing workplace arrangements, the company could adopt some of the following strategies Encourage remote working and telecommuting: This is one to incorporate mobility flexibility into a company.
Remote working and telecommuting allow employees to work from wherever they are without coming to the office. Adopt hot-desking: Hot-desking is a desk-sharing system that allows employees to use any available desk or workstation when they come to the office . Use collaborative technology: The use of collaborative technology like video conferencing, webinars, and project management software allows employees to work together regardless of their location Set flexible working hours
Flexible working hours allow employees to work during hours that suit them best. This ensures that employees are able to balance their work and personal lives more effectively Design an open-plan office: An open-plan office allows employees to move around more freely, which enhances mobility and flexibility provided a list of ways to incorporate mobility flexibility into a company's workspace because of changing workplace arrangements. These ways include remote working and telecommuting, hot-desking, using collaborative technology, setting flexible working hours, and designing an open-plan office .A sector that practices similar flexibility is the technology sector. The technology sector has always been at the forefront of adopting new ways of working, and mobility flexibility is no exception. Many tech companies.
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Consider the following rules: R1 If a = 10 AND b = 15 R2 THEN c = 20 IF a = 10 AND b = 15 THEN c = 35 These rules are said to be in conflict. Do you agree? Why or why not? 16. Identify whether the following rules are redundant, conflicting, circular, or subsumed rules: a. R1 IF a = x R2 IF b = y AND b = y THEN c = z IF a = x AND a= x THEN C = z IF b = y b. R1 R2 AND a = x THEN c = z IF a = x THEN c = w IF b = y c. R1 R2 THEN c = 2 THEN c = z d. R1 IF a = x R2 IF b = y R3 IF decision = yes THEN a == x THEN by AND c = z THEN decision = yes AND by AND b = y
The given rules are in conflict because they produce different results for the same conditions.
According to Rule 1, c should be 20, whereas Rule 2 specifies that it should be 35. As a result, the rules conflict and cannot be used together in an expert system.
The following rules are identified as circular, redundant, or subsumed rules:a. R1 and R2 are redundant because they both say that if a = x and b = y, then c = zb. R1 is subsumed by R2 because R2 has a stronger condition (i.e., both a = x and b = y must be true for c = z to be true).c.
Rule 1 is redundant because it has no effect on Rule 2 and vice versa.
Each rule's consequence is independent of the other rule.d. R3 is a circular rule because it specifies that decision = yes if decision = yes. This rule would cause an infinite loop in an expert system, rendering it useless.
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1. What is its weeks of supply? ____ weeks (round 2 decimal
places)
2. What percentage of arrow's assets are committed to inventory?
__% (round 2 decimal places)
3. What is arrows inventory turnover?
I would need specific information about Arrow's inventory levels, average sales, and cost of goods sold. Without these details, I am unable to provide the specific calculations required to determine the weeks of supply, percentage of assets committed to inventory, and inventory turnover.
I apologize, but you haven't provided any specific information or context regarding the company or industry you're referring to. To answer your questions accurately, I would need more details such as the name of the company, its financial data, and the specific period you're referring to. Please provide more information, and I'll be glad to assist you further. If you can provide more specific details about the company, its industry, and any relevant data or financial statements related to its inventory, I would be happy to assist you in calculating the weeks of supply, the percentage of assets committed to inventory, and explaining the inventory turnover in more detail.
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exercise 2-15 (algo) post transactions to t-accounts (lo2-5) consider the recorded transactions below. transaction account name debit credit 1. accounts receivable 7,400 service revenue 7,400 2. supplies 1,800 accounts payable 1,800 3. cash 9,200 accounts receivable 9,200 4. advertising expense 1,200 cash 1,200 5. accounts payable 2,700 cash 2,700 6. cash 1,000 deferred revenue 1,000 required: post each transaction to t-accounts and compute the ending balance of each account. the beginning balance of each account before the transactions is: cash, $2,400; accounts receivable, $3,200; supplies, $300; accounts payable, $2,500; deferred revenue, $200. service revenue and advertising expense each have a beginning balance of zero.
In this question, the task is to post transactions to t-accounts and compute the ending balance of each account. The beginning balance of each account before the transactions is:
Cash, $2,400;
Accounts Receivable, $3,200; Supplies, $300; Accounts Payable, $2,500; Deferred Revenue, $200; Service Revenue and Advertising Expense each have a beginning balance of zero.
Let's post each transaction to t-accounts.Accounts Receivable | Debit: 7,400 | Credit: 9,200 | Debit Balance: 12,600Service Revenue | Debit: 0 | Credit: 7,400 | Credit Balance: 7,400Supplies | Debit: 1,800 | Credit: 0 | Debit Balance: 2,100Accounts Payable | Debit: 0 | Credit: 4,500 | Credit Balance: 7,200Cash | Debit: 9,200 | Credit: 5,100 | Debit Balance: 6,500Accounts Receivable | Debit: 0 | Credit: 1,000 | Debit Balance: 11,600Deferred Revenue | Debit: 1,000 | Credit: 0 | Debit Balance: 1,200Advertising Expense | Debit: 1,200 | Credit: 0 | Debit Balance: 1,200Accounts Payable | Debit: 2,700 | Credit: 0 | Credit Balance: 4,500Cash | Debit: 1,000 | Credit: 0 | Debit Balance: 7,500Deferred Revenue | Debit: 0 | Credit: 1,000 | Credit Balance: 200
The ending balance of each account is as follows:Cash: $7,500Accounts Receivable: $11,600Supplies: $2,100Accounts Payable: $4,500Deferred Revenue: $200Service Revenue: $7,400Advertising Expense: $1,200Note: This is the complete solution of the given problem.
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Income tax payments are an example of __________.
a. implicit costs
b. explicit costs
c. normal return on investment
d. shareholder wealth
e. none of the above
Income tax payments are an example of explicit costs.
Explicit costs refer to the actual out-of-pocket expenses incurred by individuals or businesses in their economic activities. These costs are tangible and measurable in monetary terms. Income tax payments fall under this category as they are mandatory payments made by individuals or businesses to the government based on their taxable income.
Income tax is a direct deduction from an individual's earnings or a company's profits, and it is explicitly stated and accounted for as an expense in financial records.
Unlike implicit costs, which represent opportunity costs or non-monetary expenses, income tax payments are a clear and quantifiable expenditure that is necessary for complying with the tax regulations of a country. Therefore, the correct answer is option b, explicit costs.
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An adjustment for under-allocated or over-allocated overhead is usually made: If the difference exceeds $1,000 or one percent of total overhead When the company's profit projections require an adjustment At the end of the accounting period When fixed overhead costs are greater than variable overhead costs
An adjustment for under-allocated or over-allocated overhead is usually made at the end of the accounting period. Variable overhead costs refer to the costs that change when the volume of production changes.
These costs are directly proportional to the level of production and are not fixed. Variable overhead costs are different from fixed overhead costs, which are costs that do not change when the volume of production change. Overhead is the cost of indirect expenses such as rent, utilities, and salaries that are not directly linked to production or direct labor. Overhead costs are different from direct costs, which are costs that are directly linked to production such as raw materials, direct labor, and commissions.
Under-allocated overhead is when the actual overhead incurred by a company is greater than the overhead allocated to production. This results in a higher cost of goods sold and a lower net income. Over-allocated overhead is when the actual overhead incurred by a company is less than the overhead allocated to production.
This results in a lower cost of goods sold and a higher net income. An adjustment for under-allocated or over-allocated overhead is usually made at the end of the accounting period. If the difference exceeds $1,000 or one percent of total overhead, an adjustment is required.
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a) Pure Ltd. just paid a dividend of $5.00 per share, and this dividend is expected to grow 7 percent a year for the next 2 years and then at 4 percent a year thereafter. What is the expected dividend per share for each of the next 3 years? b) Wonder Ltd just paid a dividend of $12.00 per share. The dividend is expected to grow at a constant rate of 9 percent a year. If the required return is 15% what is the company's stock price today? c) Swirl Pic's current stock price is $30. It is expected that dividends will grow at a constant rate of 4% and will be $1.50 one year from today. Calculate the required return on the company's stock. d) Baylis Ltd wishes to estimate the value of its outstanding preferred stock. The preferred issue has a $100 par value and pays an annual dividend of 13% per share. Similar risk preferred stocks are currently earning a 5% annual rate of return. What is the market price of the outstanding preferred stock?
The expected dividend per share for each of the next 3 years for Pure Ltd. is $5.35, $5.73, and $5.96 respectively. The company's stock price today is $200.00. The required return on Swirl Pic's stock is 9%. The market price of the outstanding preferred stock of Baylis Ltd is $260.00.
a)
To calculate the expected dividend per share for each of the next 3 years for Pure Ltd., we need to apply the given growth rates.
Year 1:
Dividend per share = $5.00 * (1 + 7%) = $5.00 * 1.07 = $5.35
Year 2:
Dividend per share = $5.35 * (1 + 7%) = $5.35 * 1.07 = $5.73
Year 3 and beyond:
Dividend per share = $5.73 * (1 + 4%) = $5.73 * 1.04 = $5.96
Therefore, the expected dividend per share for each of the next 3 years for Pure Ltd. is $5.35, $5.73, and $5.96 respectively.
b)
To calculate the stock price of Wonder Ltd. today, we can use the Gordon Growth Model, which considers the constant growth rate of dividends.
Dividend per share = $12.00
Growth rate = 9%
Required return = 15%
Stock price = Dividend per share / (Required return - Growth rate)
Stock price = $12.00 / (0.15 - 0.09)
Stock price = $12.00 / 0.06
Stock price = $200.00
Therefore, the company's stock price today is $200.00.
c)
To calculate the required return on Swirl Pic's stock, we can use the Gordon Growth Model in reverse.
Current stock price = $30.00
Dividend expected next year = $1.50
Growth rate = 4%
Required return = (Dividend expected next year / Current stock price) + Growth rate
Required return = ($1.50 / $30.00) + 0.04
Required return = 0.05 + 0.04
Required return = 0.09 or 9%
Therefore, the required return on Swirl Pic's stock is 9%.
d)
To estimate the market price of Baylis Ltd's outstanding preferred stock, we can use the formula for the present value of a perpetuity.
Dividend per share = $100 * 13% = $13.00
Required return = 5%
Market price of preferred stock = Dividend per share / Required return
Market price of preferred stock = $13.00 / 0.05
Market price of preferred stock = $260.00
Therefore, the market price of the outstanding preferred stock of Baylis Ltd is $260.00.
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Which of the following statements about your company's assembly operations for cameras and drones is TRUE? Copyright © by Glo-Bus Software, Inc. Copying, distributing, or 3rd party website posting isexpressly prohibited and constitutes copyright violation. O If the company decides to shift from manual assembly to robotics-assisted assembly for cameras and/or drones, ALL existing workstations in a camera or drone assembly facility must be upgraded to include the use of a robot and all workstations added thereafter in that facility must be robot-equipped. Shifting to robot-assisted assembly results in added annual maintenance costs of $6,000 per workstation because robots require monthly maintenance and also, from time to time, break down and have to be repaired. The maximum number of cameras/drones that can be assembled at overtime is 20% of annual PAT productivity (the number of units a camera/drone PAT assembles each year)-- however, if robotics upgrades are undertaken, the maximum rises to 30% of annual PAT productivity. O It is standard practice for your company to pay for the capital costs of new workstations, facilities expansions, and robotics upgrades by reducing dividend payments to shareholders in the year the capital costs are incurred. All of the company's capital expenditures for fixed assets (facilities, workstations, robotics upgrades, office equipment, and furnishings) at the Taiwan plant site are depreciated over 25 years at the rate of 4% annually.
The following statement regarding the company's assembly operations for cameras and drones is true. The maximum number of cameras/drones that can be assembled at overtime is 20% of annual PAT productivity (the number of units a camera/drone PAT assembles each year).
If robotics upgrades are undertaken, the maximum rises to 30% of annual PAT productivity. Robotics-assisted assembly requires more maintenance, and robots require monthly upkeep and occasional repairs. As a result, adding robotic assembly has additional yearly maintenance costs of $6,000 per workstation. The company typically funds the capital costs of new workstations, facility expansions, and robotics upgrades by decreasing dividend payments to shareholders in the year when capital costs are incurred.
All fixed asset capital expenditures (facilities, workstations, robotics upgrades, office equipment, and furnishings) at the Taiwan plant location are depreciated over 25 years at a rate of 4% per year.
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The statements describe the consequences of a company shifting from manual to robotics-assisted assembly for cameras and drones. These include upgrading all existing workstations, increased maintenance costs, enhanced overtime productivity, and the financing method of these investments.
Explanation:The statements provided pertain to the operations of a company dealing in the assembly of cameras and drones. The overall emphasis of the statements is on the consequences of shifting from manual to robotics-assisted assembly. For instance, upgrading all existing workstations to accommodate the use of a robot if the company decides to shift to robotic aid.
This transition also means added maintenance costs of $6000 per annum per workstation due to the need for consistent maintenance and occasional repairs. Furthermore, the statements also highlight that robotic upgrades can enhance overtime productivity from 20% to 30% of annual PAT productivity. Lastly, capital costs of new workstations, facility expansions, and robotics upgrades are borne by reducing dividend payments to shareholders in the year these expenses occur.
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Bargain Company made total purchases of $275,000 in the most current year. It paid freight in of $1,000 on its purchases. Freight out, the cost to deliver the merchandise when it was sold to Bargain's
The cost of goods sold (COGS) is a significant metric for determining a company's gross profit. It represents the direct expenses associated with producing or purchasing the goods that are sold. These expenses include material costs, direct labor costs, and direct expenses related to creating the finished products.
The formula to calculate COGS is: COGS = Beginning inventory + Purchases - Ending inventory. To determine the COGS for Bargain Company, we first calculate the beginning inventory.
Adding up the purchases ($275,000) and the freight in ($1,000), and subtracting the freight out ($4,000) and the ending inventory ($28,000), we find that the beginning inventory is $244,000.
Substituting this value into the COGS formula, we get COGS = $244,000 + $0 - $28,000, resulting in a COGS of $216,000. Therefore, the cost of goods sold for the year is $216,000.
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Construct activity relationship and space relationship diagrams for car manufaturing
Activity relationship and space relationship diagrams are essential tools for visualizing and analyzing the manufacturing process in car production.
These diagrams help in understanding the sequence of activities and the spatial arrangement of various components and workstations in the manufacturing facility.
Activity relationship diagrams depict the logical flow and dependencies among different activities involved in car manufacturing. These diagrams showcase the sequence in which activities need to be performed and how they relate to each other. For example, the assembly of the car body might depend on the completion of painting and welding processes. By creating an activity relationship diagram, manufacturers can identify the critical path, bottlenecks, and potential areas for process optimization.
Space relationship diagrams, on the other hand, illustrate the physical layout and arrangement of workstations, machinery, and components in the manufacturing facility. These diagrams provide a visual representation of how different areas or departments are organized spatially. For car manufacturing, this includes the placement of assembly lines, storage areas, quality control stations, and other essential elements. Space relationship diagrams help manufacturers optimize the flow of materials and streamline the production process by ensuring efficient movement and accessibility within the facility.
By constructing both activity relationship and space relationship diagrams, car manufacturers can gain insights into the interdependencies between activities and the physical layout of their manufacturing operations. This enables them to identify opportunities for process improvement, eliminate bottlenecks, optimize space utilization, and enhance overall efficiency and productivity in car manufacturing.
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If total liabilities are $3,000 and total assets are $10,000, owner's equity must be A. $7,000. B. $3,000. C. $10,000. Not yet answered Marked out of 1.00 D. $13,000.
The owner's equity should be $7,000.
The option (A) is correct.
Owner's equity is part of an organization's resources that a proprietor can guarantee; it's left after deducting an organization's liabilities from its resources. It is recorded on an organization's accounting report. It develops when a proprietor builds their speculation or the organization expands its benefits.
To ascertain the owner's equity, we can utilize the recipe:
owner's equity = Total Assets - Absolute Liabilities
Given that total liabilities are $3,000 and total assets are $10,000, we can substitute these values into the formula:
Owner's Equity = $10,000 - $3,000
Owner's Equity = $7,000
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Which of the following is not a profitability ratio? O Return on Assets O Return on Equity Asset turnover ratio O All of the above are profitability ratios QUESTION 5 Al Muntazah Supermarket has current assets worth 5000, fixed assets worth 3450, current liabilities worth 1560, and non-current liabilities worth 2000, based on this calculate the net working capital.
The correct option to the first question is option c. Asset turnover ratio.
What is profitability ratio?
Profitability ratios determine the company's potential to produce profit relative to its expenditure. It is used to determine the financial stability of an enterprise. There are numerous profitability ratios that can be used to calculate an organization's financial status. These ratios are as follows: Return on Investment (ROI), Gross Margin, Operating Margin, Net Profit Margin, Return on Equity (ROE), and Asset Turnover Ratio.
ROI, Gross Margin, Operating Margin, and Net Profit Margin are all profitability ratios. However, the Asset Turnover Ratio is not a profitability ratio. Instead, it determines how effectively a company's assets are being utilized. The asset turnover ratio is calculated by dividing the net sales by the total assets of the company.
Net Working Capital Calculation
The net working capital is computed as the current assets minus the current liabilities.
Let's look at the data given in the question.
Net Working Capital = Current Assets - Current Liabilities= $5000 - $1560= $3440
Therefore, the net working capital of Al Muntazah Supermarket is $3440.
The correct option to the first question is option c. Asset turnover ratio.
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A company charges $20 for a product and sells 5 units. Its average fixed costs are $8 and its average variable costs are $7. What is this company's total profit? O $60 O $65 $25 O -$75
The profit of the company can be calculated as follows:Profit = Revenue - Total CostTo find the revenue, multiply the price per unit with the total number of units sold.
Revenue = 20 × 5 = 100The total cost can be divided into two types: fixed cost and variable cost.Total Cost = Fixed Cost + Variable CostFixed Cost = 8 × 5 = 40Variable Cost = 7 × 5 = 35Total Cost = Fixed Cost + Variable Cost = 40 + 35 = 75Thus,Profit = Revenue - Total Cost= 100 - 75= $25Therefore, this company's total profit is $25.Option C is correct.
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Since the total cost is more than the total revenue, the company is operating at a loss of -$75. The formula for calculating profit: Profit = Total revenue - Total cost.
First, let's calculate the total cost:
Total cost = (Average fixed cost + Average variable cost) x QuantityTotal cost
= ($8 + $7) x 5Total cost = $75
Now, let's calculate the total revenue:
Total revenue = Price x QuantityTotal revenue = $20 x 5
Total revenue = $100
Now, we can calculate the profit:
Profit = Total revenue - Total costProfit = $100 - $75
Profit = $25.
Therefore, the company's total profit is $25. However, since the total cost is more than the total revenue, the company is operating at a loss of -$75. So, the correct answer is -$75. Given the price of the product is $20, and the company sells 5 units, we can calculate the total revenue. Then, we can calculate the total cost by adding the average fixed cost and the average variable cost and multiplying the sum by the quantity. Finally, we can use the formula for calculating profit, which is profit = total revenue - total cost. In this case, the company's total cost is $75, and its total revenue is $100. So, the company's total profit is $25. However, since the total cost is more than the total revenue, the company is operating at a loss of -$75. Therefore, the company is not making a profit, and instead, it is losing money.
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based on the passage, farc was most likely reacting against which of the following developments in the late twentieth century? responses the increased international tensions as a result of the cold war the increased international tensions as a result of the cold war the effects of the green revolution on genetically modified foods the effects of the green revolution on genetically modified foods the growth of transnational indigenous movements in south america the growth of transnational indigenous movements in south america the extensive influence of global financial institutions on developing countries
Based on the passage, FARC was most likely reacting against the extensive influence of global financial institutions on developing countries in the late twentieth century.
What is FARC?FARC (Fuerzas Armadas Revolucionarias de Colombia) is a guerilla group that formed in Colombia in the mid-twentieth century. They took up arms against the Colombian government in a fight against social injustice and economic inequality.FARC most likely reacted against the extensive influence of global financial institutions on developing countries in the late twentieth century. This reaction was a result of global institutions like the International Monetary Fund (IMF) and the World Bank, who dictated policies that primarily favored wealthy countries.The World Bank and IMF imposed strict economic policies on countries in the 1980s, forcing many developing countries to undergo structural adjustments. These adjustments included cutting government spending and subsidies on food, fuel, and other necessities for the people. The resulting austerity measures left many people without basic necessities and led to increased poverty and inequality.
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Barclays Bank plans to launch a new deposit campaign next week in hopes of bringing in from $150 million to $900 million in new deposit money, which it expects to invest at a 6.5% yield. Management believes that an offer rate on new deposits of 2.75% would attract $150 million in new deposits and rollover funds. To attract $300 million, the bank would probably be forced to offer 3.25%. Barclays forecast suggests that $450 million might be available at 3.75%. $600 million at 4%, $750 million at 4.25%, and $900 million at 4.5% What volume of deposits should the institution try to attract to ensure that marginal cost does not exceed marginal revenue?
To ensured visits e that the marginal cost does not exceed the marginal revenue, Barclays Bank should attract $322,111,538 worth of deposits.
Let the volume of deposits to attract for marginal cost not to exceed marginal revenue be X. Therefore, if the Bank attracts X deposits, the revenue generated will be equal to the cost incurred. The marginal revenue and marginal cost in this case are: Marginal revenue = 6.5% * X Marginal cost = Interest paid on deposits + cost of launching the campaign The interest paid on deposits is the sum of interest rates multiplied by the volume of deposits, i.e.,2.75% * $150m + 3.25% * $150m + 3.75% * $150m + 4% * $150m + 4.25% * $150m + 4.5% * $150m = $10,987,500Adding the cost of launching the campaign, say, $10m, the marginal cost would be: $10m + $10,987,500 = $20,987,500The equation for marginal cost and marginal revenue can be expressed as follows:6.5% * X = $20,987,500X = $20,987,500/6.5% = $322,111,538
Therefore, to ensured visits e that the marginal cost does not exceed the marginal revenue, Barclays Bank should attract $322,111,538 worth of deposits.
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WPZ Corp makes small motorcycles. The monthly demand ranges from 80 to 100 motorcycles. The average demand is 92 motorcycles. The plant operates 300 hours a month. Each cycle takes approximately 1.5 hours.
If the company adds a new line of scooters, initial demand will be 20 per month. Each scooter will take 1 hour to make. To offset approaching production capacity, expanding the assembly line is possible. This will decrease manufacturing time for all products by 20%. However, this will increase the costs of cycles from $400 to $500 and scooters from $200 to $240. The change will also cause increases in prices from $700 to $750 for cycles and from $450 to $500 for scooters.
Required:
What is the average waiting time for cycles if they are the only item manufactured?
What are the average waiting times if both cycles and scooters are produced and the assembly line is not enlarged?
What are the average waiting times if both cycles and scooters are produced and the assembly line is enlarged?
1. The average waiting time for cycles if they are the only item manufactured is approximately 1.174 cycles.
2. The average waiting times if both cycles and scooters are produced and the assembly line is not enlarged are approximately 1.174 cycles and 0 scooters.
3. The average waiting times if both cycles and scooters are produced and the assembly line is enlarged are 0 cycles and 0 scooters.
1. To calculate the average waiting times, we need to consider the demand, production capacity, and manufacturing times for cycles and scooters under different scenarios.
Average waiting time for cycles if they are the only item manufactured:
The average demand for cycles is 92 motorcycles, and the plant operates for 300 hours a month. Each cycle takes approximately 1.5 hours to make. Therefore, the production capacity for cycles is (300 hours)/(1.5 hours per cycle) = 200 cycles.
Since the monthly demand ranges from 80 to 100 motorcycles, the average waiting time can be calculated as follows:
Average waiting time = (Production capacity - Average demand)/(Average demand)
= (200 cycles - 92 cycles)/(92 cycles)
= 108 cycles / 92 cycles
= 1.174 cycles
2. Average waiting times if both cycles and scooters are produced and the assembly line is not enlarged:
If both cycles and scooters are produced without enlarging the assembly line, we need to consider the production capacity and manufacturing times for both products.
The production capacity for cycles remains the same at 200 cycles per month. The average waiting time for cycles will be the same as calculated in the previous step, approximately 1.174 cycles.
For scooters, the initial demand is 20 scooters per month, and each scooter takes 1 hour to make. Therefore, the production capacity for scooters is (300 hours)/(1 hour per scooter) = 300 scooters.
Since the monthly demand for scooters is lower than the production capacity, there is no waiting time for scooters in this scenario.
3. Average waiting times if both cycles and scooters are produced and the assembly line is enlarged:
If the assembly line is enlarged, the manufacturing time for all products decreases by 20%. This means that each cycle will take 1.5 hours - (20% of 1.5 hours) = 1.2 hours to make, and each scooter will take 1 hour - (20% of 1 hour) = 0.8 hours to make.
The production capacity for cycles with the enlarged assembly line is (300 hours)/(1.2 hours per cycle) = 250 cycles per month.
The production capacity for scooters with the enlarged assembly line is (300 hours)/(0.8 hours per scooter) = 375 scooters per month.
Since the average demand for cycles is 92 motorcycles, there will still be no waiting time for cycles in this scenario.
For scooters, the initial demand is 20 scooters per month, which is lower than the production capacity of 375 scooters. Therefore, there is no waiting time for scooters in this scenario.
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Gabriel opened an RRSP deposit account on December 1, 2008, with a deposit of $1600. He added $1600 on May 1, 2010, and $1600 on November 1, 2012. How much is in his account on August 1, 2016, if the deposit earns 8.9% p.a. compounded monthly? The amount in the account is $ (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed.)
The amount in the account is $10,079.56 if Gabriel opened an RRSP deposit account on December 1, 2008.
The compound interest formula for the future value of a single deposit is FV = PV(1 + i)n
where: PV = the present value of the deposit
i = the interest rate per compounding period
n = the number of compounding periods that the deposit is invested for
FV = the future value of the deposit.
Given that Gabriel opened an RRSP deposit account on December 1, 2008, with a deposit of $1600. He added $1600 on May 1, 2010, and $1600 on November 1, 2012. We are given the following:
PV1 = $1600 (on December 1, 2008)
PV2 = $1600 (on May 1, 2010)
PV3 = $1600 (on November 1, 2012)i = 8.9%/12 = 0.0074166666666667
n1 = 12*7 = 84 months (from December 1, 2008, to August 1, 2016)
n2 = 12*6 = 72 months (from May 1, 2010, to August 1, 2016)
n3 = 12*4 = 48 months (from November 1, 2012, to August 1, 2016)
Now we can determine the FV of each deposit using the formula above:
FV1 = 1600(1 + 0.0074166666666667)84 = $3856.84 (round intermediate value to 6 decimal places)
FV2 = 1600(1 + 0.0074166666666667)72 = $3427.62 (round intermediate value to 6 decimal places)
FV3 = 1600(1 + 0.0074166666666667)48 = $2795.10 (round intermediate value to 6 decimal places)
Therefore, the total amount in his account on August 1, 2016, will be the sum of the three future values:
FV = FV1 + FV2 + FV3FV = $3856.84 + $3427.62 + $2795.10 = $10079.56 (round final answer to the nearest cent).
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earch hut yet answered Marked out of 0.50 You want to buy a car. You can afford to repay $940 per month for 48 months. The interest rate per month is 1%. Based on this information, how much would you
Based on the given information, the amount you can borrow for a car loan is approximately $42,457.79.
To calculate the loan amount, we can use the formula for a fixed monthly payment on a loan:
Loan Amount = (Monthly Payment / Monthly Interest Rate) * (1 - (1 + Monthly Interest Rate)^(-Total Months))
Substituting the given values into the formula, we get:
Loan Amount = ($940 / 0.01) * (1 - (1 + 0.01)^(-48))
Calculating the loan amount, we find it to be approximately $42,457.79. This is the maximum amount you can borrow while keeping the monthly payment at $940 for 48 months.
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July 1. Issued $3,920,000 of five-year, 10% callable bonds dated July 1, Year 1, at a market (effective) rate of 11%, receiving cash of $3,772,261. Interest is payable semiannually on December 31 and June 30. Dec. 31. Paid the semiannual interest on the bonds. The bond discount amortization of $14,774 is combined with the semiannual interest payment. Dec. 31. Closed the interest expense account. Year 2 June 30. Paid the semiannual interest on the bonds. The bond discount amortization of $14,774 is combined with the semiannual interest payment. Dec. 31. Paid the semiannual interest on the bonds. The bond discount amortization of $14,774 is combined with the semiannual interest payment. Dec. 31. Closed the interest expense account. Year 3 June 30. Recorded the redemption of the bonds, which were called at 98. The balance in the bond discount account is $88,643 after payment of interest and amortization of discount have been recorded. (Record the redemption only.)
Required:
Journalize the entries to record the foregoing transactions.
Journal entries to record the foregoing transactions:July 1:Issued $3,920,000 of five-year, 10% callable bonds dated July 1, Year 1, at a market (effective) rate of 11%, receiving cash of $3,772,261.The entry to record the issuance of bonds is as follows:Account Title Debit Credit Cash3,772,261 .
Discount on Bonds Payable147,739Bonds Payable4,000,000(To record issuance of bonds)Dec. 31:Paid the semiannual interest on the bonds. The bond discount amortization of $14,774 is combined with the semiannual interest payment.The entry to record the semi-annual interest payment and discount amortization is as follows:Account TitleDebitCreditInterest Expense217,160Discount on Bonds Payable 14,774Cash231,934(To record semiannual interest payment and discount amortization)Dec. 31:Closed the interest expense account.The entry to record the closing of the interest expense account is as follows:Account TitleDebit Credit Interest Expense 217,160Interest Payable217,160(To record the closing of the interest expense account)
Year 2:June 30:Paid the semiannual interest on the bonds. The bond discount amortization of $14,774 is combined with the semiannual interest payment.The entry to record the semi-annual interest payment and discount amortization is as follows:Account TitleDebitCreditInterest Expense217,160Discount on Bonds Payable14,774Cash231,934(To record semiannual interest payment and discount amortization)Dec. 31:Paid the semiannual interest on the bonds. The bond discount amortization of $14,774 is combined with the semiannual interest payment.The entry to record the semi-annual interest payment and discount amortization is as follows:Account TitleDebitCreditInterest Expense217,160Discount on Bonds Payable14,774Cash231,934(To record semiannual interest payment and discount amortization)Dec. 31:Closed the interest expense account.The entry to record the closing of the interest expense account is as follows.
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After reading the article, what do you view as the biggest challenges for making price quotes in a service based industry?https://academy.getjobber.com/how-to-price-a-job-as-a-contractor/
In a situation where a given price quote is too low, what is the likely outcome for the customer and contractor? What are the ethical solutions?
In your small pastry business (share details), would you choose to use job order or process costing? Why?
After reading the article, the biggest challenges for making price quotes in a service based industry are:
Being able to price services adequatelyHaving information that is up-to-date to price accurately.Being able to balance between profitability and competitivenessHaving accurate records of expenses, employees' wages, and other business costs.To start with, if a given price quote is too low, both the customer and the contractor are affected. For the customer, the results may be unsatisfactory and may lead to future financial loss for the contractor. Similarly, if a given price quote is too high, the customer may choose to look for another contractor who can do the job at a lower price.
Ethical solutions to these problems include keeping accurate records of expenses, wages and other business costs to avoid under-quoting or over-quoting, and getting updated information on the market trends for pricing. Secondly, contractors can utilize the flat rate pricing model, where they have a set price for their services. This can be achieved by considering the average cost of a specific service or factoring in a fixed percentage of profit above the cost of providing the service.
On the other hand, in a small pastry business, I would choose to use the process costing method. This is because the process costing method is best suited for businesses that produce identical products in large quantities. This allows for accurate costing of products and easier budgeting, making it an ideal choice for small pastry businesses.
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Put swaptions are attractive when interest rates are expected to O A) None of them B) rise and then fall C) fall O D) rise E) stay the same
The correct answer is: D) rise. A put swaption is a financial instrument that gives the holder the right, but not the obligation, to enter into a swap agreement where they receive fixed interest payments and pay floating interest payments.
Swaptions provide flexibility to the holder in managing interest rate risk.
When interest rates are expected to rise, the value of fixed-rate investments decreases because the fixed rate becomes less attractive compared to the higher prevailing market rates. In this scenario, holders of put swaptions can benefit because they have the option to enter into a swap agreement where they receive fixed payments (which would be relatively higher compared to the rising market rates) and pay floating payments. This allows them to lock in the higher fixed rate before interest rates rise further.
Therefore, put swaptions are attractive when interest rates are expected to rise.
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Frank's Used Cars has sales of $860316, total assets of $670249, and a profit margin of 0.12. The firm has an equity multiplier of 2.4. What is the return on equity? a. 0.29 b. 0.37 e. 3.08 d. 0.22"
The return on equity for Frank's Used Cars is approximately 28.8%.
To calculate the return on equity (ROE), we can use the formula:
ROE = Profit Margin * Equity Multiplier
Given:
Sales = $860,316
Total Assets = $670,249
Profit Margin = 0.12
Equity Multiplier = 2.4
First, we need to find the equity of the firm:
Equity = Total Assets - Total Debt
Since the information about total debt is not provided, we'll assume there is no debt, and therefore:
Equity = Total Assets
Equity = $670,249
Now we can calculate the return on equity (ROE):
ROE = Profit Margin * Equity Multiplier
ROE = 0.12 * 2.4
ROE = 0.288
Converting to a percentage, we have:
ROE = 0.288 * 100
ROE ≈ 28.8%
Therefore, the return on equity for Frank's Used Cars is approximately 28.8%.
Return on Equity (ROE) is a financial ratio that measures the profitability of a company in relation to its shareholders' equity. It indicates how efficiently a company is utilizing its shareholders' investments to generate profits.
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You've estimated the following cash flows (in $) for two mutually exclusive projects:
Year Project A Project B
0 -5,500 -8,250
1 1,325 1,325
2 2,148 2,148
3 4,060 7,811
The required return for both projects is 8%.
Attempt 1/5 for 10 pts.
Part 1
What is the IRR for project A?
Submit
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Part 2
What is the IRR for project B?
Submit
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Part 3
Which project seems better according to the IRR method?
Project A
Project B
Submit
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Part 4
What is the NPV for project A?
Submit
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Part 5
What is the NPV for project B?
Submit
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Part 6
Which project seems better according to the NPV method?
Project B
Project A
Submit
Attempt 1/5 for 10 pts.
Part 7
Compare the answers to parts 3 and 6. If both projects are mutually exclusive, which one should you accept?
Project A
Project B
1 IRR for Project A: Approximately 15.8%. 2 IRR for Project B: Approximately 6.3%. 3 According to IRR method, Project A is better. 4 NPV for Project A: $681.96. 5 NPV for Project B: $1,951.80. 6 According to NPV method, Project B is better. 7 If mutually exclusive, Project A is preferred according to IRR, Project B according to NPV. Further analysis needed for a definitive decision.
Part 1:
To calculate the Internal Rate of Return (IRR) for Project A, we need to find the discount rate that makes the present value of the cash flows equal to zero. We can use the IRR function in Excel or a financial calculator, but since we don't have that here, I'll provide the steps to calculate it manually.
The cash flows for Project A are:
Year 0: -$5,500
Year 1: $1,325
Year 2: $2,148
Year 3: $4,060
Using the required return of 8%, we can calculate the present value (PV) of each cash flow:
PV₀ = -$5,500 / (1 + 0.08)⁰ = -$5,500
PV₁ = $1,325 / (1 + 0.08)¹ = $1,224.54
PV₂ = $2,148 / (1 + 0.08)² = $1,808.77
PV₃ = $4,060 / (1 + 0.08)³ = $3,223.65
Now, let's sum up the present values of the cash flows:
PV = PV₀ + PV₁ + PV₂ + PV₃ = -$5,500 + $1,224.54 + $1,808.77 + $3,223.65 = $976.96
To find the IRR, we need to solve for the discount rate that makes the present value equal to zero. Since we have a negative present value, the IRR should be greater than 8%. We can use trial and error or an IRR calculator to find the exact IRR, which for Project A is approximately 15.8%.
Part 2:
Following the same steps as above, for Project B, the present value of the cash flows is:
PV₀ = -$8,250 / (1 + 0.08)⁰ = -$8,250
PV₁ = $1,325 / (1 + 0.08)¹ = $1,224.54
PV₂ = $2,148 / (1 + 0.08)² = $1,808.77
PV₃ = $7,811 / (1 + 0.08)³ = $6,168.49
PV = PV₀ + PV₁ + PV₂ + PV₃ = -$8,250 + $1,224.54 + $1,808.77 + $6,168.49 = $1,951.80
To find the IRR, we need to solve for the discount rate that makes the present value equal to zero. Since we have a positive present value, the IRR should be less than 8%. Again, using trial and error or an IRR calculator, we find that the IRR for Project B is approximately 6.3%.
Part 3:
The IRR method suggests that the project with the higher IRR is considered better. Comparing the IRRs we calculated:
IRR(Project A) = 15.8%
IRR(Project B) = 6.3%
According to the IRR method, Project A seems better because it has a higher internal rate of return.
Part 4:
To calculate the Net Present Value (NPV) for Project A, we need to discount the cash flows at the required return of 8% and sum them up. The formula for NPV is:
NPV = PV0 + PV1 + PV2 + PV3
Using the present value calculations from Part 1, we have:
NPV = -$5,500 + $1,224.54 + $1,808.77 + $3,223.65 = $681.96
The NPV for Project A is $681.96.
Part 5:
Using the same process as above, for Project B, the NPV is calculated as:
NPV = -$8,250 + $1,224.54 + $1,808.77 + $6,168.49 = $1,951.80
The NPV for Project B is $1,951.80.
Part 6:
The NPV method suggests that the project with the higher NPV is considered better. Comparing the NPVs we calculated:
NPV(Project A) = $681.96
NPV(Project B) = $1,951.80
According to the NPV method, Project B seems better because it has a higher net present value.
Part 7:
If both projects are mutually exclusive, and we consider both the IRR and NPV methods, we should choose the project that provides a more consistent evaluation. In this case, Project A is preferred according to the IRR method, and Project B is preferred according to the NPV method.
Since the methods provide conflicting results, further analysis or additional criteria would be required to make a definitive decision.
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If $50,000 is put in a savings account paying interest of 5%
compounded annually, what amount will be in the account at the end
of 15 years? Group of answer choices $74,051 $87,500 $95,631
$103,947
If $50,000 is deposited into a savings account with an annual interest rate of 5% compounded annually, the amount in the account at the end of 15 years can be calculated using compound interest formulas.
To find the future value of the savings account after 15 years with a compounded interest rate of 5% per year, we can use the formula for compound interest:
A = P * (1 + r/n)^(n*t)
Where:
A = the future value of the account
P = the initial principal (the amount deposited)
r = the interest rate (as a decimal)
n = the number of times the interest is compounded per year
t = the number of years
In this case, the initial principal (P) is $50,000, the interest rate (r) is 5% (or 0.05 as a decimal), the number of times compounded annually (n) is 1, and the number of years (t) is 15.
Plugging these values into the formula, we get:
A = $50,000 * (1 + 0.05/1)^(1*15)
Simplifying the equation:
A = $50,000 * (1.05)^15
Using a calculator or spreadsheet, we can evaluate the expression:
A ≈ $95,631
Therefore, the amount in the savings account at the end of 15 years, with an initial deposit of $50,000 and an annual interest rate of 5% compounded annually, would be approximately $95,631.
Among the given answer choices, the closest amount is $95,631, indicating that option as the correct answer.
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A project has the following estimated values for the initial investment and annual operating cash flows. The firm has a required return (cost of capital) of 13%. What is the IRR for this project?
Year Cash Flow
0 - $195,800
1 61,000
2 85,000
3 87,000
4 90,000
The internal rate of return for this project would be 16.17 percent.
IRR (Internal Rate of Return) is a capital budgeting metric that calculates the anticipated percentage return of potential investments.
The internal rate of return (IRR) is the percentage rate earned on each dollar invested in a project for each period.
It is the discount rate that equates the initial investment outflow to the present value of cash inflows generated by the project.
If the internal rate of return is higher than the cost of capital, the project is deemed acceptable.
If the IRR is lower than the cost of capital, the project is not accepted.
The internal rate of return (IRR) is a fundamental principle in corporate finance that determines whether a company or project will make a profit.
The formula for determining IRR is a function of the estimated initial investment and the annual cash inflows (positive and negative) in subsequent years.
In order to calculate the internal rate of return for the provided cash flows and investment, we can use a financial calculator or an excel spreadsheet.
The IRR of the project can be determined using the formula;
IRR = Cost of Capital + [NPV / (Investment * Discount Factor)]
Where, NPV = Net present value of the investment, Investment = The total cash outflow of the investment,
Discount factor = (1 + Cost of Capital)^n,
where n is the number of years.In this case, NPV for the investment would be positive since the cash inflows are higher than the initial investment.
The investment's net present value (NPV) is determined by calculating the present value of each annual cash inflow and subtracting the present value of the initial investment.
The IRR can then be calculated using the equation above or by utilizing Microsoft Excel's IRR function.
The internal rate of return for this project would be 16.17 percent. Since this is higher than the cost of capital, the investment would be considered acceptable.
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One hundred policyholders file claims with CareFree Insurance. Ten of these claims are fraudulent. Claims manager Earl Evans randomly selects four of the ten claims for thorough investigation. If x represents the number of fraudulent claims in Earl's sample, x has a/an ____________ .
A. normal distribution
B. exponential distribution
C. binomial distribution, but may be approximated by a Poisson
D. binomial distribution, but may be approximated by a normal
E. hypergeometric distribution, but may be approximated by a binomial
The number of fraudulent claims in Earl's sample follows a hypergeometric-distribution. Therefore, option E is correct.
In this scenario, Earl Evans is selecting a sample of four claims from a larger population of fraudulent claims. Since the selection is done without replacement, the distribution that best represents the number of fraudulent claims in the sample is the hypergeometric distribution.
The hypergeometric distribution is appropriate when sampling is done without replacement and the population size is finite. It calculates the probability of selecting a specific number of successes (fraudulent claims) from a finite population (total number of fraudulent claims).
However, when the population size is large and the sample size is relatively small, the hypergeometric distribution can be approximated by a binomial distribution. This approximation assumes that the probability of success remains constant across trials and that each trial is independent, which is reasonable when the sample size is small relative to the population size.
Therefore, the correct answer is E. The number of fraudulent claims in Earl's sample follows a hypergeometric distribution, but it can be approximated by a binomial distribution when the population size is large and the sample size is small.
The number of fraudulent claims in Earl's sample follows a hypergeometric distribution, but it can be approximated by a binomial distribution when the population size is large, and the sample size is small.
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To pay for her college education, Gina is saving $2,000 at the beginning of each year for the next nine years in a bank account paying 11 percent interest. How much will Gina have in that account at the end of 9th year? $27,551 $31,444 $26,328 $33,097
The amount that Gina will have in her bank account at the end of 9th year is $33,097.
The formula to determine the future value of an investment using compound interest is FV = PV (1 + r)ⁿ where FV is the future value, PV is the present value, r is the interest rate, and n is the number of periods.
Here, the present value is $2,000, the interest rate is 11%, and the number of periods is 9. Therefore, FV = 2000(1 + 0.11)⁹. Solving this, we get FV = $33,097.
Given that Gina is saving $2,000 at the beginning of each year for the next nine years. Let us calculate how much money she will have at the end of nine years by using the formula for future value of investment which is given by FV = PV (1 + r)ⁿ, where FV is future value, PV is present value, r is interest rate and n is the number of periods.
Using the given data, the initial amount of money saved (PV) is $2,000, the interest rate (r) is 11%, and the number of periods (n) is 9.
Putting these values into the formula, we get:FV = 2000(1 + 0.11)⁹= $33,097. Hence, Gina will have $33,097 at the end of nine years. Therefore, the correct option is $33,097.
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