Finance Assignment
Question 1 (16 points) Carol Inc is considering the following three prices to charge customers for each of the candy packets they produce: i) $2.20 ii) $2.00 iii) $1.70 The relevant data for decisionmaking is below: Fixed Costs = $1200 Variable Costs = $0.50 per unit Calculate the following: a) The Breakeven Point for each price level b) Using price of $2.20 what would be the new breakeven point if (1) fixed costs decreased to $1000 all else remaining the same, (2) Variable costs increased to $0.75 all else remaining the same. Draw a graph to represent scenario (1) and (2) comparing with the original data for price of $2.20. [Total of two graphs] Question 2 (12 points) Greater Manufacturing is evaluating two different operating …show more content…
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Question 8 (6 points) Hubbards is analyzing the performance of its cash management. On average, the firm holds inventory 65 days, pays its suppliers in 35 days, and collects its receivables in 15 days. The firm has a current annual outlay of $1,960,000 on operating cycle investments. Hubbards currently pays 10 percent for its negotiated financing. (Assume a 360 day year.) (a) Calculate the firm's cash conversion cycle. (b) Calculate the firm's operating cycle. (c) Calculate the daily expenditure and the firm's annual savings if the operating cycle is reduced by 15 days. Question 9 (14 points) Table 15.2
The company earns 5 percent on current assets and 15 percent on fixed assets. The firm's current liabilities cost 7 percent to maintain and the average annual cost of longterm funds is 20 percent. a) The firm's initial net working capital is ________. [Numerical Answer] b) The firm's initial annual profits on total assets are ________. [Numerical Answer] c) If the firm was to shift $3,000 of current assets to fixed assets, the firm's net working capital would ________, the annual profits on total assets would ________, and the risk of technical insolvency would ________, respectively. [Choose either the word increase or decrease for each blank] d) If the firm was to shift $7,000 of fixed assets to current assets, the

Corporate Finance Assignment 1
708 Words  3 Pagesstrong evidence that internal markets are more efficient than external markets.” Firms use internal capital because it is much easier for managers to use profits from previous years to finance their investments, management don´t have to prove their investment decisions to investors. If management would need to finance investment with external capital, the cost of the capital would much higher than using internal capital. Issues would cause direct costs for (järjestämisestä) and take time and effort…

Finance Assignment CAPM Essay
858 Words  4 Pagestheory redundant.” Introduction This assignment will explore whether CAPM makes portfolio theory redundant. The following areas will be discussed; Stages involved, functions and roles, important components, formula of capM, positive and negative aspects of CapM, all while drawing to the conclusion to whether CapM makes portfolio theory redundant. (ref:2) Definition CAPM is defined as Capital asset pricing model. It is an economic theory and is used in Finance to determine a theoretically appropriate…

Finance Assignments
1084 Words  4 Pagesinvestment strategy. The value of this model lies in its ability to accurately predict the performance of an asset once its risk has been identified. This places those in charge of assessing risks very valuable and important in this entire process. Assignment 2 I have chosen Caterpillar Inc as a reference company to help describe the Capital Asset Pricing Model (CAPM). This model incorporates historical data with risk analysis in order to help set prices for a given investment market. Certain numbers…

Principles of Finance Assignment
1422 Words  6 PagesAndrew Wolford BYS330 Principles of Finance Week Four Assignment March 4th, 2014 Chapter Ten Study Problem 104: (Payback period, NPV, PI, and IRR calculations) You are considering a project with an initial cash outlay of $80,000.00 and expected free cash flows of $20,000.00 at the end of each year for 6 years. The required rate of return for this project is 10 percent. a. What is the project’s payback period? Remember first that payback period is the number of years needed to recover the initial…

Finance Assignment
1755 Words  8 PagesAssignment 1 Q1.) (5 points) $50 today is worth MORE than $50 tomorrow.(Tell True or False) Q2.) $100 invested for 10 years at 12% interest is worth more in FV terms than $200 invested for 10 years at 4% interest. (Tell True or False) Q3.) Shawn wants to buy a new telescope. He estimates that it will take him one year to save the money and that the telescope will cost $200. At an interest rate of 6%, how much does Shawn need to set aside today to purchase the telescope in one year? Q4.)Johnny and…

Project Finance Assignment
2466 Words  10 PagesMain characteristics of project finance Project finance is a form of long term financing of infrastructure and industrial projects based upon the projected cash flows of the project rather than the balance sheets of the project sponsors. In most cases, a project financing structure involves a number of equity investors, the sponsors, as well as a group of banks or other lending institutions that provide loans to the operation. The loans are usually nonrecourse loans, which are secured by the project…

Entrepreneurial Finance Assignment 1
2511 Words  11 PagesEntrepreneurial finance assignment 1 Problem 4.4. Introduction The CAPM model can be used to analyze the performance of a portfolio of investments. The model should be calculated by comparing the return of assets (Ri) minus the return of riskfree cash (Rf) of the fund against those numbers of a known index with historical data (Rm). With leastsquares regression, a straight line has to be drawn through the points to finish the model. Alpha represents the point where the graph starts and…

Finance Assignment 1
3198 Words  13 PagesJWI 530: Financial Management I Academic Submissions and Evaluations Assignment 2: Management Accounting Application Due Week 10, Day 7 (Weight: 22.5%) In this assignment you will demonstrate your understanding of capital investment techniques by evaluating the following three case studies. The homework answers and all this homework help was offered at and you should not submit or make it your own. We provide homework answers at http://allhomeworktutors.com/ and the work may have already…

Public Finance Assignment
831 Words  4 PagesProblem 1 (Public goods/Voting) Recommended source: Rosen, Public Finance. Citizens/voters in a hamlet inhabited by only three citizens consider the provision of street light. The marginal benefit curve of each citizen is downward sloping in the amount of street light provided. The cost of providing street light consists of erecting lamp posts and the electricity for illumination. For part a)c) of this question, assume the following: All lamps are switched on during the hours of darkness such…

finance assignment 1
1105 Words  5 PagesAssignment 1: Part 1: Economic Basics (10.0 points) Please BOLD/HIGHLIGHT your answers to make it easy for me to see your answers. 1. Describe two examples of important things that financial planning skills can help you do, and explain why these things are important to you personally. (46 sentences. 2.0 points) It makes a plan for you to save money in order to buy a house, a car, go to college or afford to move into an apartment. I would like to start saving money so I could be able to move out…
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