Organisations are open system and cannot operate in isolation. External factors continuously impact on the organisation. With reference to an industry you are familiar with, Organizations and industries operate in an ever-changing environment with external factors impacting them on a regular basis.
For example, in the automotive industry, external factors such as consumer demand, technology, government regulations, competition, economic conditions, and environmental factors have a significant influence.
Consumer demand can fluctuate with economic cycles, changing trends, and consumer preferences. Automotive manufacturers must continually monitor consumer behavior and adjust their production levels accordingly. Technology advancements can also affect the industries, with new technology and materials influencing the design and cost of vehicles.
Government regulations regarding safety, emissions, fuel efficiency, and other aspects of the industry can also impact manufacturers. Furthermore, competition from other automotive manufacturers can be a major factor, as firms must compete for market share. Finally, economic conditions such as inflation and interest rates can affect both consumer demand and manufacturer profitability.
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Problem 1 A research report produced by a dealer includes the following table: USD/EUR CHF/USD USD/GBP Spot Rate 1.1701 0.9900 1.3118 Expected Spot Rate in One Year 1.1619 0.9866 1.3066 Answer the following based on the table above:
1. What is the spot CHF/EUR cross-rate?
2. What is the spot GBP/EUR cross-rate?
3. By how much is the Euro expected to appreciate against the US dollar over the next year? Express your answer as a percentage.
4. By how much the US dollar is expected to appreciate by how much against the British pound over the next year? Express your answer as a percentage.
5. Over the next year, decide whether the Swiss franc is expected:
a. to appreciate or depreciate against the GBP. What is the percentage?
b. to appreciate or depreciate against the EUR. What is the percentage?
6. Based on the table above, list the three currencies of USD, GBP, and EUR from strongest to weakest over the next year?
7. Based on the exhibit, list the three currencies of GBP, CHF, and EUR in order of appreciating the most to appreciating the least (in percentage terms) against the USD over the next year?
1. The spot CHF/EUR cross-rate is 1.1804.
2. The spot GBP/EUR cross-rate is 1.3279.
3. The Euro is expected to appreciate against the US dollar by 0.0082 or 0.71% over the next year.
4. The US dollar is expected to appreciate against the British pound by 0.0052 or 0.40% over the next year.
5.a. The Swiss franc is expected to appreciate against the GBP by 0.0134 or 1.35%.
b. The Swiss franc is expected to depreciate against the EUR by 0.0035 or 0.36%.
6. USD, EUR, GBP from strongest to weakest over the next year.
7. GBP, EUR, CHF from appreciating the most to appreciating the least (in percentage terms) against the USD over the next year.
How to calculateThe spot CHF/EUR cross-rate can be calculated by dividing the spot rate of CHF/USD by the spot rate of USD/EUR. This gives us: Spot CHF/EUR = 0.9900 / 1.1701 = 0.8457 The spot GBP/EUR cross-rate can be calculated by dividing the spot rate of GBP/USD by the spot rate of USD/EUR. This gives us: Spot GBP/EUR = 1.3118 / 1.1701 = 1.1213 The Euro is expected to appreciate against the US dollar by (1.1701 - 1.1619) / 1.1701 = 0.0070, or 0.70%. The US dollar is expected to appreciate against the British pound by (1.3118 - 1.3066) / 1.3118 = 0.0040, or 0.40%. Over the next year, the Swiss franc is expected to appreciate against the GBP by (0.9900 - 0.9866) / 0.9900 = 0.0034, or 0.34%. It is also expected to appreciate against the EUR by (0.8457 - 0.8449) / 0.8457 = 0.0009, or 0.09%. Based on the table above, the three currencies of USD, GBP, and EUR are expected to be strongest to weakest in the following order: EUR, GBP, USD. Based on the table above, the three currencies of GBP, CHF, and EUR are expected to appreciate the most to least (in percentage terms) against the USD in the following order: EUR (0.70%), CHF (0.34%), GBP (0.40%).Learn more about cross rate at
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Select a publicly traded company and access its most recent financial statements, form 10-K, from its website. Include the name of the company in your subject line, and do not choose a company about which one of your classmates has already posted. Navigate to the notes to the financial statements and locate the company’s note on revenue recognition. Does the company follow the five-step revenue recognition model? How can you tell? In your own words, summarize how the company is applying the five-step revenue recognition model.
Participate in follow-up discussions by comparing your company’s five-step process to the company they chose. Specifically address, how the companies are similar or different and how the industry in which the company does business influences the application of the five-step model.
The company I selected is Apple Inc. According to their 10-K, Apple Inc follows the five-step revenue recognition model.
This is evident in their note on revenue recognition, which states that they recognize revenue when the customer obtains control of the promised goods or services, in an amount that reflects the consideration that is expected to be received in exchange for the goods or services.
Additionally, it states that their recognition of revenue includes all five steps of the revenue recognition process, including identification of the contract, identification of performance obligations, determination of transaction price, allocation of the transaction price to performance obligations, and recognition of revenue.
Apple Inc's five-step revenue recognition process is similar to the company chosen by my classmate. Both companies follow the five-step model, however the industry in which the company does business influences the application of the model.
For example, Apple Inc's primary revenue comes from the sale of their products and services, while the other company may focus on sales of services. This difference may lead to different methods of applying the five-step revenue recognition model, as certain industries may require certain performance obligations or methods of recognizing revenue.
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assume we have a cycle-servixe level of 90%, and we deliver 4 items
on a customers order, what is the overall customer service level
for the order?
The overall customer service level for the order is 90%.
This is because the cycle-service level is a measure of the probability that a customer will receive their order within a specified period of time. In this case, the cycle-service level is 90%, which means that there is a 90% chance that the customer will receive their order within the specified period of time.
Since we are delivering 4 items on the customer's order, the overall customer service level for the order is also 90%.
It is important to note that the cycle-service level is only one aspect of customer service, and there are many other factors that can affect the overall customer service level for an order, such as the quality of the products, the speed of delivery, and the level of customer support provided.
However, in this case, the cycle-service level is the only factor that we are considering, so the overall customer service level for the order is 90%.
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What is inherent risk, discuss inherent risk factors with examples of events or conditions that may indicate the existence of material misstatements at the assertion level (the class of transactions, account balance or disclosure).
Inherent risk is the risk of material misstatement in the financial statements due to the nature of the business or the specific accounts involved, regardless of the company's internal controls.
Inherent risk, in other words, is the likelihood that an error or fraud could occur in the financial statements, even with adequate internal controls in place.
- Complexity of transactions: The more complex the transactions, the higher the risk of material misstatements.
- Susceptibility to fraud: Certain accounts, such as cash, are more susceptible to fraud than others.
- Inexperienced management or staff: If the company's management or staff are inexperienced, there is a higher risk of errors or misstatements.
- High volume of transactions: The higher the volume of transactions, the greater the risk of misstatements.
- Changes in the business environment: Changes in the business environment, such as new regulations or competition, can increase the risk of misstatements.
- Unusual or complex transactions that are difficult to account for accurately
- High turnover of key employees or management
- Weaknesses in the company's internal controls
- Significant changes in the company's financial performance or operations
- Discrepancies between the company's financial statements and other information, such as budgets or forecasts.
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Global Wings Airlines (GWA) is a publicly traded, Atlanta based airline. GWA is expanding its offering of flights to Western Europe. To facilitate this expansion GWA needs additional capital. Due to the large amount of capital that needs to be raised the company does not have sufficient internal financial capital available. For the same reason private placements of equity securities or bank loans are not a viable option either. The company is considering a new offering of common equity securities
Assume you are a team of analysts who follow this company and industry. You have the task of analyzing the new issue of common equity for the purpose of investing in this security. Consider the company and industry. Examine a set of financial statements for a similar company and do some research on the internet. (Do not use Customer Satisfaction ratings.) Review the information in chapter 3 (and the part of 16 that was covered) of your text. Your team should write a brief, concise response that addresses the following questions. NOTE THAT NO ACTUAL RATIO CALCULATIONS FOR GWA CAN BE DONE, SINCE YOU DON'T HAVE ITS FINANCIALS. You are to layout a model for the analysis.
1. Besides strengths financial ratio analysis unfortunately also has its weaknesses. Sometimes, nonfinancial ratios, indicators or indices can be useful to financial analysts as well. Describe an example of a nonfinancial ratio that could be helpful for a financial analyst in the airline industry. You may develop your own or find a ratio that is currently used in the airline industry. Why would this ratio be helpful? (There is a whole web site on this topic!)
2. Assume your team decided to use the Fixed Asset Turnover as one of the ratios for your model in question 1. You calculated this ratio for GWA and compare it to the ratio for GWA’s most important competitor.
A. Fixed assets are usually the largest asset category on an airline’s balance sheet. What are the largest fixed assets that you would expect an airline to have?
B. In comparing GWA’s fixed asset turnover to that of their most important competitor you notice that there is a considerable difference. You are surprised with this significant difference in fixed asset utilization and you wonder, if accounting methods may have something to do with it. How could accounting methods influence the outcome of a fixed asset turnover? Provide a specific answer with illustration.
One example of a nonfinancial ratio that could be helpful for a financial analyst in the airline industry is the load factor. This ratio measures the percentage of seats that are filled with paying passengers.
It is calculated by dividing the number of revenue passenger miles (RPM) by the number of available seat miles (ASM). A higher load factor indicates that an airline is utilizing its capacity more efficiently and is likely generating more revenue per flight. This ratio is helpful for financial analysts because it provides insight into an airline's ability to generate revenue and manage its capacity.
It can also be used to compare the performance of different airlines or to track an airline's performance over time.
The Answer for Question 2 (A and B)A. The largest fixed assets that you would expect an airline to have are aircraft, airport facilities, and equipment. These assets are essential for an airline's operations and typically represent a significant portion of an airline's total assets.B. Accounting methods can influence the outcome of a fixed asset turnover by affecting the value of fixed assets on the balance sheet. For example, if an airline uses a different depreciation method than its competitor, the value of its fixed assets may be lower, which would result in a higher fixed asset turnover.Learn more about Congressional Airlines https://brainly.com/question/25694705
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Suppose Prime Bank limited expects the Taka to appreciate from its present spot rate of $0.013 to $0.016 in 45 days. Currently the following interbank borrowing and lending rates exits:
Currency
Lending Rate (%)
Borrowing Rate (%)
US Dollar
5.0
5.8
Bangladesh Taka
6.5
7.5
Assume Prime Bank has the borrowing capacity of US 10 Million or BDT 50 Million in the interbank market, depending on which currency it wants to borrow. How the ban could capitalize its expectation about Taka appreciation against US Dollar. Estimate the Bank’s profit that could be generated from its strategy.
Prime Bank could generate a profit of US$2,271,983.45 by capitalizing on its expectation of Taka appreciation against the US Dollar using a currency swap strategy.
In order to capitalize on the expected appreciation of the Taka against the US Dollar, Prime Bank could use a currency swap strategy. This involves borrowing in one currency and lending in another currency, with the expectation that the exchange rate will move in their favor.
Step 1: Prime Bank borrows US$10 million at the borrowing rate of 5.8% for 45 days.
Step 2: Prime Bank converts the US$10 million to BDT at the spot rate of $0.013, resulting in BDT 769,230,769.23.
Step 3: Prime Bank lends the BDT 769,230,769.23 at the lending rate of 6.5% for 45 days.
Step 4: After 45 days, Prime Bank receives BDT 771,964,743.59 (principal + interest) from the borrower.
Step 5: Prime Bank converts the BDT 771,964,743.59 back to US$ at the expected spot rate of $0.016, resulting in US$12,351,435.50.
Step 6: Prime Bank repays the US$10 million loan plus interest (US$10,079,452.05), resulting in a profit of US$2,271,983.45.
Therefore, Prime Bank could generate a profit of US$2,271,983.45 by capitalizing on its expectation of Taka appreciation against the US Dollar using a currency swap strategy.
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What is an example how the futures contract you’re following could be used for hedging purposes if I was following TSLA future contract
Call
TSLA221216C00750000
TSLA Dec 2022 750.000 call
PUT
TSLA221216P00800000
TSLA Dec 2022 800.000 put
If you were following a TSLA future contract, one example of how it could be used for hedging purposes would be to buy a call option and a put option at different strike prices.
A futures contract is an agreement between two parties to buy or sell an asset at a predetermined future date and price. One of the main uses of futures contracts is for hedging purposes, which is the practice of reducing risk exposure by taking an offsetting position in a related asset or market.
If you were following a TSLA future contract, one example of how it could be used for hedging purposes would be to buy a call option and a put option at different strike prices. The call option (TSLA221216C00750000) gives you the right to buy TSLA stock at a predetermined price of $750.00 on or before December 16, 2022. The put option (TSLA221216P00800000) gives you the right to sell TSLA stock at a predetermined price of $800.00 on or before December 16, 2022.
By buying both the call and put options, you are hedging against the possibility of the stock price moving significantly in either direction. If the stock price rises above $800.00, you can exercise the call option and buy the stock at a lower price, while if the stock price falls below $750.00, you can exercise the put option and sell the stock at a higher price. This strategy, known as a straddle, allows you to limit your risk exposure and potentially profit from large price movements in either direction.
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According to never eat alone, ferrazzi suggests that you need equal parts of what in order to create a successful mentorship?
According to Ferrazzi in Never Eat Alone, successful mentorship requires equal parts trust, and generosity.
Giving without expecting anything in return is what it means to be generous. A successful mentoring relationship, according to Ferrazzi, is built on a foundation of generosity, where the mentor freely shares their contacts, knowledge, and experience with the mentee in order to help them achieve their goals.
Healthy relationships are based on the ability to establish and uphold trust in both professional and personal contexts. Ferrazzi contends that trust is the cornerstone of all successful interactions, including mentorship.
Therefore Ferrazzi in Never Eat Alone says to create successful mentorship you need equal parts of trust and generosity.
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RESPOND IN 175 WORDS
There are many capital project funds. Roadway, highways, improvements on roads and infrastructures are examples of Capital Project Funds. The purpose is specific funding to a project with an allocated budget estimated. A debt service fund is a reserve for fees and obligatory expenditures to be paid on time. It is a net to the project funding. So it stays on schedule. Having this sort of reserve lowers the risk on specific funding. A Permanent Fund is a fund that is set up and maintain by state and local government for various funding. An example is the Alaskan Permanent Fund. The State's generated revenue from natural resources, mainly oil, that is used and revenue generated a percentage of this is set aside as a portfolio for investment which are then turn around to eligible Alaskans as dividends from this generated revenue. This permanent fund was established in the late 1970's by the Alaskan State. The difference between government-wide financial statements and fund-basis financials is the government-wide financials give all contributing funding and is very detailed and similar to a business Income Statement, while fund-basis statement only shows a time period of specific funding from the government and represents a modified accrual accounting transactions .
Capital project funds are used to fund large-scale infrastructure projects such as roads, highways, and other improvements.
These funds are allocated specifically for these projects and have a set budget. Debt service funds are used to pay for fees and other obligatory expenditures related to the project. These funds help to ensure that the project stays on schedule and lowers the risk of running out of funding. Permanent funds are set up by state and local governments to provide ongoing funding for various projects. An example of this is the Alaskan Permanent Fund, which is funded by revenue generated from the state's natural resources and is used to provide dividends to eligible Alaskans.
The main difference between government-wide financial statements and fund-basis financials is the level of detail provided. Government-wide financial statements provide a comprehensive view of all funding sources and expenditures, similar to a business income statement. Fund-basis financials, on the other hand, only provide information on specific funding sources and expenditures for a set period of time and use modified accrual accounting transactions. This means that fund-basis financials do not provide as much detail as government-wide financial statements, but they can still be useful for understanding the financial health of a specific project or fund.
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Good business leaders create a vision, articulate the vision, passionately own the vision, and relentlessly drive it to completion. Discuss how often should an organisation’s vision/mission be changed in light of strategy evaluation activities.
An organisation's vision/mission should be changed as often as necessary in light of strategy evaluation activities. It is important for a business to stay up to date with changing market conditions and customer needs, and to continuously reassess and adjust its vision/mission accordingly.
It is recommended that an organisation's vision/mission be reviewed at least once a year during the strategy evaluation process. This will ensure that the business stays on track with its goals and is able to adapt to any changes in the market or industry. However, if there are significant changes in the business environment or if the organisation's performance is not meeting expectations, it may be necessary to re-evaluate and adjust the vision/mission more frequently.
In conclusion, an organisation's vision/mission should be changed as often as necessary in light of strategy evaluation activities, but it is important to strike a balance between maintaining stability and making necessary changes. Regular reviews of the vision/mission can help ensure that the business stays on track with its goals and is able to adapt to changing market conditions.
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what can you to do change the climate (supportive or defensive) of an existing relationship ?
There are several things that can be done to change the climate of an existing relationship, whether it is to make it more supportive or defensive.
1. Communicate openly and honestly: One of the most important things in any relationship is communication. If there are issues or concerns that need to be addressed, it is important to be open and honest about them in order to create a more supportive and healthy relationship.
2. Set boundaries: It is important to set boundaries in a relationship to ensure that both people are comfortable and feel respected. This can help to create a more supportive and defensive climate in the relationship.
3. Practice empathy: Putting yourself in the other person's shoes and trying to understand their perspective can help to create a more supportive and understanding climate in the relationship.
4. Be supportive and encouraging: Offering support and encouragement can help to create a more positive and supportive climate in the relationship.
5. Address any issues or conflicts head on: It is important to address any issues or conflicts in the relationship as soon as they arise in order to prevent them from escalating and creating a defensive climate.
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Why is it important to regularly monitor/ review implemented
treatment/s or controls of business risk against measures of
success? Give three reasons.
It is important to regularly monitor and review implemented treatments or controls of business risk against measures of success for the following reasons are Effectiveness, Compliance, Continuous Improvement.
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A company with 9,000,000 shares outstanding reported EPS of $7.75 for the year now ended and has announced an annual dividend per share of $3.45. If the company uses a residual dividend policy and is planning to borrow $6,000,000 in new debt, how much is the company planning for total capital expenditures in the coming year?
A company with 9,000,000 shares outstanding reported EPS of $7.75 for the year now ended and has announced an annual dividend per share of $3.45. If the company uses a residual dividend policy and is planning to borrow $6,000,000 in new debt, the company is planning for total capital expenditures of $57,750,000 in the coming year.
The company is planning for total capital expenditures of $57,750,000 in the coming year.
To find out how much the company is planning for total capital expenditures, we can use the following formula:
Total Capital Expenditures = (EPS x Shares Outstanding) + New Debt - (Dividend per Share x Shares Outstanding)
Plugging in the given values, we get:
Total Capital Expenditures = ($7.75 x 9,000,000) + $6,000,000 - ($3.45 x 9,000,000)
Total Capital Expenditures = $69,750,000 + $6,000,000 - $31,050,000
Total Capital Expenditures = $44,700,000 - $31,050,000
Total Capital Expenditures = $57,750,000
Therefore, the company is planning for total capital expenditures of $57,750,000 in the coming year.
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You should not put all of your eggs in one basket.
Diversification is essential and beneficial to your financial strategy. But to what extent will it be beneficial?
We have discussed the possibility of World War 3 (hopefully not!) as a result of Russia's confrontation with Ukraine. To which risk category does this belong? Do you believe that diversification might completely compensate for the war's investment loss?
Let me know what you think!
The phrase "Don't put all your eggs in one basket" is a metaphor for diversification, which means spreading out your investments among different types of assets or classes (stocks, bonds, mutual funds, real estate, etc.).
This mainly aims to minimize the potential risk associated with any one investment.
To what extent diversification will be beneficial will depend on the individual's portfolio, goals, and risk tolerance.
Risk associated with Russia's confrontation with Ukraine would fall into the category of political risk, which is a type of investment risk that arises from changes in a country's political or economic environment that could cause a negative change in the value of investments.
Diversification may not be able to completely compensate for losses related to political risk, but it can help to minimize the impact.
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Consider the different types of team members who would be essential in developing a new business or entrepreneurial venture. What skills and talents do you feel would need to be included? Share with t
In developing a new business or entrepreneurial venture, essential team members should possess a variety of skills and talents. These may include - Leadership, problem solving skills, technical skills.
In developing a new business or entrepreneurial venture, essential team members should possess a variety of skills and talents. These may include:
Business acumen, such as knowledge of the industry, market trends, and the ability to generate and analyze financial data.Leadership and management skills, such as the ability to plan, motivate, and organize people.Creativity, such as the ability to develop innovative products and services.Communication and interpersonal skills, such as the ability to listen, collaborate, and effectively convey ideas.Problem solving skills, such as the ability to analyze and resolve problems.Technical skills, such as the ability to use computers and other technology.For such more question on technical:
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With relevant examples discuss and distinguish management
accounting and financial accounting in modern businesses.
Management accounting is used to provide information to internal stakeholders for decision-making purposes, while financial accounting is used to provide information to external stakeholders about the financial position and performance of the business.
Management accounting and financial accounting are two different types of accounting that are used in modern businesses. While both are important for the financial success of a business, they have different purposes and uses.
Management accounting is focused on providing information to internal stakeholders, such as managers and employees, to help them make informed business decisions. This type of accounting is used to create budgets, forecast future financial performance, and analyze the costs and benefits of different business activities. Examples of management accounting reports include budget variance reports, cost-volume-profit analysis, and performance reports.
On the other hand, financial accounting is focused on providing information to external stakeholders, such as investors and creditors. This type of accounting is used to create financial statements, such as the balance sheet and income statement, which provide information about the financial position and performance of the business. Examples of financial accounting reports include the balance sheet, income statement, and statement of cash flows.
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Define the Organization Culture and describe its characteristics and importance in any organization? i need it detailed please and thanks !
Organization Culture refers to the beliefs, values, attitudes, and behaviors that are shared by members of an organization. It is the set of norms and practices that shape the way an organization operates and how its members interact with each other.
The characteristics of Organization Culture include:
- Shared values and beliefs: Members of an organization have a common set of values and beliefs that guide their actions and decisions.
- Norms and practices: There are established ways of doing things within an organization that are followed by all members.
- Language and communication: Members of an organization use a common language and communication style to interact with each other.
- Leadership and management style: The way leaders and managers operate within an organization reflects its culture.
- Symbols and rituals: Organizations may have specific symbols and rituals that are used to reinforce their culture.
The importance of Organization Culture cannot be overstated. It affects every aspect of an organization, from its performance and productivity to the satisfaction and retention of its employees. A strong and positive culture can help an organization achieve its goals and attract and retain top talent. On the other hand, a negative or toxic culture can lead to high turnover, low morale, and poor performance.
In conclusion, Organization Culture is a critical aspect of any organization and has a significant impact on its success. It is important for organizations to understand their culture and work to create a positive and supportive environment for their employees.
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Differentiate between the terms Effectiveness & Efficiency
Answer:
Efficiency is defined as the ability to accomplish something with the least amount of wasted time, money, and effort or competency in performance. Effectiveness is defined as the degree to which something is successful in producing a desired result; success.
In April 2019, Van Dyck Exponents offered 250 shares for sale in an IPO. Half of the shares were sold by the company and the other half by existing shareholders, each of whom sold exactly half of their existing holding. The offering price to the public was $56 and the underwriters received a spread of 7%. The issue was heavily oversubscribed and on the first day of trading the stock price rose to $151.
a-1. What were the proceeds of the issue to the company?
a-2. What were the proceeds of the issue to the shareholders?
b. How much commission did the underwriters receive?
c. How much money was left on the table?
d. What was the cost of the underpricing to the selling shareholders?
The proceeds of the issue to the company were $7,000, the commission received by the underwriters was $980, the amount of money left on the table was $11,875 and the cost of the underpricing to the selling shareholders was $5,937.50.
A-1. The proceeds of the issue to the company were $7,000. This is calculated by taking half of the 250 shares offered for sale (125 shares) and multiplying it by the offering price of $56 per share ($56 x 125 = $7,000).
A-2. The proceeds of the issue to the shareholders were also $7,000. This is calculated in the same way as the proceeds to the company, by taking half of the 250 shares offered for sale (125 shares) and multiplying it by the offering price of $56 per share ($56 x 125 = $7,000).
B. The commission received by the underwriters was $980. This is calculated by taking the total proceeds of the issue ($14,000) and multiplying it by the spread of 7% (0.07 x $14,000 = $980).
C. The amount of money left on the table was $11,875. This is calculated by taking the difference between the first day trading price ($151) and the offering price ($56) and multiplying it by the total number of shares offered for sale (250 shares) ($151 - $56 = $95 x 250 = $11,875).
D. The cost of the underpricing to the selling shareholders was $5,937.50. This is calculated by taking half of the amount of money left on the table ($11,875 / 2 = $5,937.50).
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Conduct a research on the international business of Sushiro – a leading conveyer belt sushi business founded in Japan in 1984. Sushiro started its internationalization in 2011 by opening its first overseas outlet in Korea. Recently, it developed its business in Hong Kong.In your assignment, describe the international business of Sushiro. Analyze the factors that drives Sushiro to expand overseas and the risks it faces in overseas markets. Discuss how its international business is affected by social and cultural factors. Then suggest what actions it should take to be successful in international business.1. Identify and describe the type of international business of Sushiro.
2. Identify and explain ONE key factor prompted Sushiro to operate outside Japan.
3. Explain ONE key social or cultural factor affected the company’s international business activities.4. Analyse and explain ONE key risk the company faced when it operates overseas.
5. With reference to the risk you mentioned in Q.4, what is your suggested action(s) for Sushiro? Explain.
1. Sushiro is engaging in market-seeking internationalization.
2. One key factor is home market.
3. The social or cultural factor affected the company’s international business activities is language barrier.
4. One risk is cultural miscommunication.
5. Sushiro should invest in cultural awareness training for their employees who are operating in the foreign market.
1. Sushiro is engaging in market-seeking internationalization, which is a strategy wherein an organization attempts to expand operations to a foreign market. This strategy focuses on obtaining a foreign market advantage by capitalizing on different market opportunities abroad.
2. A key factor prompting Sushiro to operate outside of Japan is the fact that their home market is relatively saturated. Expanding into new markets would allow Sushiro to increase their profits, as well as take advantage of new opportunities abroad.
3. A key social or cultural factor affecting Sushiro's international business activities is the language barrier. Different countries have different languages and different customs, so in order to do business in those countries, Sushiro has to first learn about the language and culture of the market.
4. One key risk the company faces when operating overseas is the potential for cultural miscommunication. Because of the language barrier and the differences in culture, it can be difficult to understand the needs and preferences of the customers in the foreign market, leading to misunderstandings and potential miscommunication.
5. To help minimize the risk of cultural miscommunication, Sushiro should invest in cultural awareness training for their employees who are operating in the foreign market. This training should include language lessons, cultural sensitivity training, and an understanding of the customs and values of the market they are operating in.
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Suppose the risk-free rate is 3%, the expected return on the market is 13%, and its standard deviation (risk) is 23%. A Greek company Alpha-Gama has a standard deviation 50%, but it is uncorrelated with the market. Calculate Alpha-Gama’s beta and expected return. Comment on your findings and explain your answer.
The beta of a company is a measure of its systematic risk, or the risk that is correlated with the market. In the case of Alpha-Gama, its standard deviation is 50%, but it is uncorrelated with the market. This means that its beta is 0, as it has no systematic risk. Alpha-Gama’s beta and expected return is 3 percent.
To calculate the expected return of Alpha-Gama, we can use the Capital Asset Pricing Model (CAPM), which states that the expected return of a company is equal to the risk-free rate plus the product of its beta and the market risk premium (the difference between the expected return on the market and the risk-free rate).
Using the CAPM formula, we can calculate the expected return of Alpha-Gama as follows:
Expected return = Risk-free rate + (Beta x Market risk premium)
= 3% + (0 x (13% - 3%))
= 3%
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Free cash flow to equity last year was $4 million.
It grew by 20% in the current year; it is expected to grow at a 15% rate annually for the next five years, and then assume a more normal 4% growth rate thereafter.
The firm’s cost of equity is 10% during the high growth period and then drops to 8% during the normal growth period.
What is the present value of the firm to equity investors (equity value)?
If the market value of the firm’s debt is $10 million, what is the present value of the firm (enterprise value)?
Therefore, the company's present value (stock value) to investors is $161.449891 million and the company's present value (enterprise value) is $171.449891 million.
1. The present value (equity value) of a company to equity contributors can be calculated using the discounted cash flow model (DCF). The DCF model calculates present value by discounting future cash flows by the company's cost of equity.
a. Calculate the free cash flow to equity (FCFE) for each year of peak growth.
1st year FCFE = $4M * 1.2 = $4.8M2nd year FCFE = $4.8 million * 1.15 = $5.52 millionYear 3 FCFE = $5.52 million * 1.15 = $6.348 million4th year FCFE = $6,348,000 * 115 = $7,302,000Year 5 FCFE = $7.3002 million * 1.15 = $8.39523 millionb. Take the company's cost of equity as 10% and discount the FCFE for each year of the high growth period.
Year 1 PV = $4.8M / (1 + 0.1)^1 = $4.363636MYear 2 PV = $5.52 million / (1 + 0.1)^2 = $4.553719 millionYear 3 PV = $6,348,000 / (1 + 0.1)^3 = $4,707,536,000Year 4 PV = $7.3002 million / (1 + 0.1)^4 = $4.827623 millionYear 5 PV = $8.39523 million / (1 + 0.1)^5 = $4.916377 millionc. Use the Gordon Growth Model to calculate the terminal value of the company at the end of the high growth period.
Terminal Value = FCFE Year 5 * (1 + long-term growth rate) / (cost of equity - long-term growth rate)Final = $8.39523 million * (1 + 0.04) / (0.08 - 0.04) = $223.1773 milliond. Discount the terminal value to the present value using the company's cost of equity of 10%.
Final PV = $223,177,300 / (1 + 0.1)^5 = $138,080,000e. Sum the present value of FCFE for each year of peak growth and the present value of terminal value to get the present value of the company to equity investors (equity value).
Asset Value = $4.363636M + $4.553719M + $4.707536M + $4.827623M + $4.916377M + $138.081M = $161.449891M2. The present value (enterprise value) of a company can be calculated by adding the market value of the company's debt to its equity value.
Enterprise Value = $161.449891 million + $10 million = $171.449891 millionHere to learn more about the discounted cash flow model (DCFF) at the link
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Q18) You invest $1,585.00 at the beginning of every year and your friend invests $1,585.00 at the end of every year. If you both earn an annual rate of return of 3.99% , how much more money will you have after 29.0 years? (2 points)
money you will have after 29.0 years compared to your friend, is $4,996.81 more than your friend after 29.0 years.
FV = P * (((1 + r) ^ n) - 1) / r
Where FV is the future value, P is the payment, r is the annual rate of return, and n is the number of years.
For you, the formula would be:
FV = 1585 * (((1 + 0.0399) ^ 29) - 1) / 0.0399
FV = 1585 * (3.2655 - 1) / 0.0399
FV = 1585 * 2.2655 / 0.0399
FV = $90,456.36
For your friend, the formula would be:
FV = 1585 * (((1 + 0.0399) ^ 28) - 1) / 0.0399
FV = 1585 * (3.1426 - 1) / 0.0399
FV = 1585 * 2.1426 / 0.0399
FV = $85,459.55
So the difference between the two amounts is:
$90,456.36 - $85,459.55 = $4,996.81
Therefore, you will have $4,996.81 more than your friend after 29.0 years.
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10. Explain which strategy from the two previous questions is the most important, and why. 11. Why is it sometimes necessary to change leaders to ensure cultural change?
10. The most important strategy from the two previous questions depends on the specific situation and the goals of the organization. 11. It is sometimes necessary to change leaders to ensure cultural change because a leader plays a crucial role in shaping and influencing the culture of an organization.
However, in general, effective communication is often the most important strategy because it allows for clear understanding and alignment of goals and expectations. Without effective communication, there may be confusion or misunderstandings that can hinder progress and success.
If a leader is not supportive of the desired cultural change or is not able to effectively communicate and implement the necessary changes, it may be necessary to bring in a new leader who can better facilitate the desired cultural shift.
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Anthony Soohoo
Co-founder and CEO of Dot & Bo
"During my time as a product manager on Apple's PowerBook team, we were
gearing up to launch a new product. As part of testing, we had found that a
very small sample size was flawed and could be harmful. I was under
tremendous pressure to make a decision on whether or not to hold off bringing the product to
market. And there were good arguments on both sides."
On the one hand, the defected sample size was small and not statistically significant, and
millions of dollars would be lost by holding off shipment. On the other hand, Soohoo believed
the long-term impact risk was high.
"If the flaw was bigger than we thought, it could have created a huge loss of trust with our
customers," he says.
When there is a difficult decision to make, make it based on what would create long-term value
instead of gaining the short-term win.
Ultimately, Soohoo decided to delay the launch of the product. "In the end, it came down to
taking a long-term perspective, and it just made more sense to delay the launch," he says.
"Putting myself in the shoes of our customers, I think that's what they would have expected
Apple to do. Not a popular decision at the time, but it was the right decision for the business."
The lesson: "Trust your gut to do the right thing for the customers. When there is a difficult
decision to make, make it based on what would create long-term value instead of gaining the
short-term win. That lesson has remained with me throughout my career."Identify
- The Ethical Issue the leader faced
- Identify 2 negative outcomes of the Ethical Dilemma Analyse and provide your opinion
The ethical issue the leader faced was deciding whether to go ahead with the launch of the product despite knowing that a small sample size was flawed and could be harmful.
If the leader chose to go ahead with the launch, there could be a long-term negative impact on the company's reputation, as customers may lose trust in the company. Furthermore, if the flaw was bigger than expected, the company may incur high costs to recall or repair the products.
In my opinion, the leader made the right decision in delaying the launch, as it put the customers' interests first and minimized the potential risks that may have come with releasing a faulty product. Furthermore, it showed that the company valued the customers' trust, which in turn will have positive impacts on the long-term value of the company.
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A. What type/(s) of Appeal/(s) and Informational Structure under
Message Structure/Creative Strategy does IDLC uses to develop the
Message of those advertisements?
IDLC uses a combination of different types of appeals and informational structures to develop the message of their advertisements and include Emotional Appeal , Rational Appeal , Informational Structure
1. Emotional Appeal: IDLC uses emotional appeal to create an emotional connection with their target audience. This is achieved through the use of persuasive language, imagery, and storytelling.
2. Rational Appeal: IDLC also uses rational appeal to present logical arguments and factual information to their target audience. This is done through the use of statistics, data, and other forms of evidence.
3. Informational Structure: IDLC uses informational structure to organize the information in their advertisements in a way that is easy for their target audience to understand. This includes using headings, bullet points, and other visual cues to help guide the reader through the information.
Overall, IDLC uses a combination of these different types of appeals and informational structures to develop the message of their advertisements and effectively communicate with their target audience.
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By following a straddling strategy, firms can broaden their capabilities and effectively compete with more focused firms in markets requiring low cost for success. True/false
False, Straddling is a dangerous tactic that frequently fails. In every market the straddling firm enters, more narrowly focused companies can effectively compete with it.
Traders can benefit from a variety of advanced straddling trading tactics regardless of whether the market is rising or falling. In the realm of options, some of the more complex tactics, such iron condors and iron butterflies, are legendary. They demand intricate option buying and selling at different strike prices. The goal is to ensure that a trader may profit regardless of the direction that the underlying price of the stock, currency, or commodity ultimately takes.
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How long will $520,000, in an investment account that earns 3.55% compounded monthly, sustain month-end withdrawals of $3,200? (Do not round intermediate calculations and round up the number of payments, n, to the next whole number.)
year(s) and month(s).
The investment account will sustain month-end withdrawals of $3,200 for 16 years and 9 months.
To find out how long the investment account will sustain month-end withdrawals of $3,200, we can use the formula for the future value of an annuity due:
FV = PMT × (((1 + i)ⁿ - 1) / i) × (1 + i)
Where FV is the future value, PMT is the payment, i is the interest rate, and n is the number of payments.
In this case, we are given:
FV = $520,000
PMT = $3,200
i = 3.55% / 12 = 0.00295833
n = unknown
We can rearrange the formula to solve for n:
n = ln((FV × i) / (PMT × (1 + i)) + 1) / ln(1 + i)
Plugging in the given values:
n = ln(($520,000 × 0.00295833) / ($3,200 × (1 + 0.00295833)) + 1) / ln(1 + 0.00295833)
n = 200.02
Since we are asked to round up the number of payments to the next whole number, n = 201.
To find out how many years and months this corresponds to, we can divide by 12:
years = 201 / 12 = 16.75
months = 0.75 × 12 = 9
So the investment account will sustain month-end withdrawals of $3,200 for 16 years and 9 months.
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A bond with a yearly coupon of 5% matures in one year. Thepenultimate coupon has just been paid. The Macauley duration of thebond in years is
The Macaulay duration of the bond in question is 1 year. The Macaulay duration of a bond is a measure of the average time that cash flows from the bond are received.
It is calculated by taking the weighted average of the time to maturity for each cash flow, where the weights are the present values of the cash flows.
In the case of the bond in question, there is only one cash flow remaining, which is the final coupon payment and the repayment of principal at maturity in one year. Therefore, the Macaulay duration of the bond is simply 1 year.
In mathematical terms, the Macaulay duration is calculated as follows:
D = ∑t*PV(CFt)/∑PV(CFt)
Where:
D = Macaulay duration
t = time to maturity for each cash flow
PV(CFt) = present value of each cash flow
In this case, there is only one cash flow at t=1, so the equation simplifies to:
D = 1*PV(CF1)/PV(CF1) = 1
Therefore, the Macaulay duration of the bond in question is 1 year.
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What is the definition of "Learning" ? Give practical examplesto demonstrate your answer.
The definition of "Learning" is the acquisition of knowledge or skills through study, experience, or being taught. It is the process of gaining new information, understanding, and abilities that help us to adapt to our environment and make informed decisions.
For example, a practical example of learning would be learning how to ride a bike. This involves gaining knowledge about the mechanics of a bike, understanding how to balance and steer, and acquiring the physical skills needed to ride a bike. Through practice and experience, we are able to learn how to ride a bike effectively and safely.
Another example of learning is studying for a test. This involves gaining knowledge about the subject matter, understanding the concepts and ideas, and applying that knowledge to answer questions and solve problems. Through study and practice, we are able to learn the material and perform well on the test.
In both of these examples, learning involves acquiring new information and skills, and applying them in a practical way to achieve a desired outcome.
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