Base on the picture, why is scenario planning important in the business or workplace? With the current Covid restrictions1putting many businesses at risk,planning for and analysis of differentALAEscenarios has never been so crucial forall businesses to ensure their futuresuccess - performing 'what if scenarioscan help business owners to betterunderstand each financial decision orinvestment.Failing to plan for different scenarioscan leave the door wide open togreater risk and missed opportunities.In today's uncertain climate, creating'what if' scenarios could be vital to yourbusiness's survival.'What if' scenarios can improve theoverall performance of your businessby allowing you to plan for challengesand possibilities and meet yourcompany's growth objectives. They can help to remove some of theuncertainty from your finances while1providing the flexibility to takeadvantage of opportunities - if you arelooking for a finance provider, theyare more likely to fund your project ifyou can demonstrate that you haveconsidered various key scenarios andtheir potential impacts.By using 'what if planning you can runscenarios utilising both real time andhistorical data. By using appropriatesoftware you can identify potentialfuture risks in minutes rather thanwaiting months, such as budgetshortfalls and inefficient processes, andmake quicker decisions without theneed for endless meetings anddiscussions.

A workplace, often known as a current workplace, is a platform where users work on activities,…

Answered: Base on the picture, why is scenario…

Understanding Business

12th Edition

ISBN:9781259929434

Author:William Nickels

Publisher:William Nickels

Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment

Section: Chapter Questions

Problem 1CE

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Proper risk management involves a three stage process. Which one of the following isone of those stages:a) Identify where the risk liesb) Select the right tools to execute strategyc) Design an appropriate strategy for managing riskd) All of the above
Rollo Megabux has $1 million to invest in stocks orbonds. The percentage yield on each investment during thecoming year depends on whether the economy has a goodor a bad year (see Table 17). It is equally likely that theeconomy will have a good or a bad year.a If Rollo is risk-neutral, how should he invest hismoney?b For $10,000, Rollo can hire a consulting firm toforecast the state of the economy. The consulting firm’sforecasts have the following properties:P(good forecast|economy good) .80P(good forecast|economy bad) .20Should Rollo hire the consulting firm? What are EVSIand EVPI? Economy EconomyHas Good Has BadYear YearYield on stocks 22% 10%Yield on bonds 16% 14%
Some new product launches fail and this leaves a negative impact on the profitability of the company. Using a particular product as an example, discuss1. Some of the key determinates and conditions that need to be met to launch that product successfully on the market; 2. What may go wrong with the launch of that product and why? 3. What steps should the company launching the product take in order to mitigate product launch failure or to address the situation in the event of a failure of the launch of that product
2. Using the following table, perform ALL FIVE of the techniques for Decision Making under Uncertainty: Maximax, Maximin, Hurwicz Realism (α = 0.7), LaPlace and Minimax Regret. You must show your work for obtaining the points. PROFIT ($) STRONG MARKET FAIR MARKET POOR MARKET Large facility 550,000 110,000 -310,000 Medium-sized facility 300,00 129,000 -100,000 Small facility 200,000 100,000 -32,000 No facility 0 0 0
Your company needs to make an important decision thatinvolves large monetary consequences. You have listedall of the possible outcomes and the monetary payoffsand costs from all outcomes and all potential decisions.You want to use the EMV criterion, but you realize thatthis requires probabilities and you see no way to findthe required probabilities. What can you do?
A potentially huge hurricane is forming in theCaribbean,and there is some chance that it mightmake a direct hit on Hilton Head Island, SouthCarolina,where you are in charge of emergencypreparedness. You have made plans for evacuatingeveryone from the island, but such an evacuation isobviously costly and upsetting for all involved, so thedecision to evacuate shouldn’t be made lightly. Discusshow you would make such a decision. Is EMVa relevant concept in this situation? How would youevaluate the consequences of uncertain outcomes?
Assume you are a risk manager who has recentlybeen appointed by a large US-owned but EU-basedengineering and general construction company calledBubbles PLC. The company has a number of officesaround the world including a number in Europe andthe US and relatively new offices in India and severallocations in South East Asia. Bubbles PLC isstructured around a number of main functional orbusiness divisions including InfrastructureDevelopment, Professional Services, EnvironmentalServices and Facilities Management. Bubbles PLCoperates a number of subsidiary companies thatoffer a range of services ranging from roads termmaintenance contracts for Local Authorities as in thecase of Moose Ltd to professional design services, asin the case of Blowers Professional Services.The company has an annual turnover of aroundK400m and is generally operating at a reasonablelevel, although growth has been slightly slower thanexpected over the past 2 years.As part of a long-term strategic review, the…
1/ Explain why all investors should choose the same risky portfolio from the efficient set. 2/ Identify on the CML two investors; one who is risk averse and one who is not
Dave is the owner of Fine Pool and Spa. He just discovered that his that his trusted friend Chris, who has been his accountant for over 20 years, has been skimming money from Fine’s bank account. Dave has to decide whether to ignore his Chris’s actions in order to avoid conflict and bad publicity, or to have Chris arrested for embezzlement. What is Dave facing? a. whistle – blower b. a synergy factor c. a social audit d. an ethical dilemma e. an issue of corporate governance
You often hear about the trade-off between risk and reward. Is this trade-off part of decision making under uncertainty when the decision maker uses theEMV criterion? For example, how does this work in investment decisions?
1. Suppose you are going on a weekend trip to a city that is d miles away. Develop a model that determines your round-trip gasoline costs. What assumptions or approximations are necessary to treat this model as a deterministic model? Are these assumptions or approximations acceptable to you? 2. Suppose that a manager has a choice between the following two mathematical models of a given situation: (a)a relatively simple model that is a reasonable approximation of the real situation, and (b)a thorough and complex model that is the most accurate mathematical representation of the real situation possible. Why might the model described in part (a) be preferred by the manager?
When forming the objectives and constraints part of the IPS, a portfolio manager must consider ability and willingness to take risk. Explain what is meant by these terms and how the manager can accommodate these risks

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