Suppose that you have found the optimal risky combination using all risky assets available in the economy, and that this optimal risky portfolio has an expected return of 0.13 and standard deviation of 0.3. The T-bill rate is 0.03.

What fraction of your money must be invested in the optimal risky portfolio in order to form a complete portfolio with an expected return of 0.09?

Round your answer to 4 decimal places. For example, if your answer is 3.205%, then please write down 0.0321.

Answers

Answer 1

Answer: 0.6000.

Given: The expected return on optimal risky portfolio is 0.13;

Standard deviation of optimal risky portfolio is 0.3;

The T-bill rate is 0.03;

To find: What fraction of money must be invested in optimal risky portfolio to form a complete portfolio with expected return 0.09?

Let, x be the fraction of money to be invested in the risky asset.

Therefore, 1 - x is the fraction of money to be invested in the risk-free asset.

The expected return of the complete portfolio is given by the formula:

Rp = (1 − x)Rf + xRp

where

Rp = expected return on complete portfolio,

Rf = Risk-free rate, and

Rp = Expected return on risky asset.

Rp = (1 − x)Rf + xRp

Rp = (1 − x)(0.03) + x(0.13)0.09

= 0.03 - 0.03x + 0.13x0.06

= 0.1x ⇒ x = 0.6 = 60%

Thus, 60% of money must be invested in the optimal risky portfolio in order to form a complete portfolio with an expected return of 0.09. Answer: 0.6000.

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Related Questions

The In-Tech Company just paid a dividend of $1.60 per share. Analysts expect its dividend to grow at 15 percent per year for the next three years and then 3 percent per year thereafter. If the required rate of return on the stock is 12 percent, what is the current value of the stock?

Answers

The current value of the stock for The In-Tech Company is approximately $5.13 per share.

To calculate the current value of the stock for The In-Tech Company, we can use the dividend discount model (DDM). The DDM values a stock based on the present value of its expected future dividends.

Given:

Dividend just paid = $1.60 per shareDividend growth rate for the next three years = 15%Dividend growth rate thereafter = 3%Required rate of return = 12%

To calculate the current value of the stock, we need to calculate the present value of each expected dividend and sum them up.

1. Calculate the dividends for the next three years based on the expected growth rate:

Year 1 dividend = Dividend just paid * (1 + Dividend growth rate)

Year 1 dividend = $1.60 * (1 + 15%) = $1.84

Year 2 dividend = Year 1 dividend * (1 + Dividend growth rate)

Year 2 dividend = $1.84 * (1 + 15%) = $2.116

Year 3 dividend = Year 2 dividend * (1 + Dividend growth rate)

Year 3 dividend = $2.116 * (1 + 15%) = $2.4384

2. Calculate the present value of the dividends using the required rate of return:

Present value (PV) = Dividend / (1 + Required rate of return)^n

Where n represents the number of years.

PV of Year 1 dividend = $1.84 / (1 + 12%)^1 ≈ $1.64

PV of Year 2 dividend = $2.116 / (1 + 12%)^2 ≈ $1.68

PV of Year 3 dividend = $2.4384 / (1 + 12%)^3 ≈ $1.81

3. Calculate the present value of all dividends:

PV of all dividends = PV of Year 1 dividend + PV of Year 2 dividend + PV of Year 3 dividend

PV of all dividends ≈ $1.64 + $1.68 + $1.81 ≈ $5.13

Therefore, the current value of the stock for The In-Tech Company, based on the dividend discount model, is approximately $5.13 per share.

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Taxpayer owns a 20% profits and capital interest in Norse LLC. For the current year Norse LLC has the following revenues, expenses, gains and losses:

Sale revenue $70,000, Gain on sale of land (Sec 1231) $11,000, Cost of goods sold, ($26,000), Depreciation MACRS ($3,000), Sec 179 deduction ($10,000), Employee wages ($11,000),nondeductible penalties ($3,000), Municipal bond interest $6,000) STCG $4,000, Guaranteed payment to Sandra $3,000.

Enter Taxpayer appropriate amount for each separately stated item. Enter zero if there is no item. enter any expense as a negative i.e. -100

a. How much ordinary business income is allocated to Taxpayer?

b. What is Taxpayer's Section 1231 gain?

c. What is Taxpayer's Section 179 deduction?

d. What is Taxpayer's short term capital gain?

e. What is Taxpayer's municipal bond interest

f. What is Taxpayer's nondeductible fines?

g. What is Taxpayer's guaranteed payment?

Answers

a. Ordinary business income allocated to Taxpayer: $30,000 b. Taxpayer's Section 1231 gain: $11,000 c. Taxpayer's Section 179 deduction: ($10,000) d. Taxpayer's short-term capital gain: $4,000 e. Taxpayer's municipal bond interest: $6,00f. Taxpayer's nondeductible fines: ($3,000) g. Taxpayer's guaranteed payment: $3,000

a. To calculate the ordinary business income allocated to the taxpayer, we need to add up the appropriate items:

Sale revenue: $70,000

Cost of goods sold: ($26,000)

Depreciation MACRS: ($3,000)

Employee wages: ($11,000)

Ordinary business income allocated to Taxpayer:

$70,000 - $26,000 - $3,000 - $11,000 = $30,000

b. Taxpayer's Section 1231 gain is the gain on the sale of land, which is given as $11,000.

c. Taxpayer's Section 179 deduction is given as ($10,000). It is a negative expense, representing the deduction taken under Section 179 of the Internal Revenue Code.

d. Taxpayer's short-term capital gain is given as $4,000.

e. Taxpayer's municipal bond interest is given as $6,000.

f. Taxpayer's nondeductible fines are given as ($3,000). It is a negative expense, representing the fines that are not deductible.

g. Taxpayer's guaranteed payment to Sandra is given as $3,000.

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A key component of strategic management is ________, which means how an organization is distinctive from others.
a. formulation
b. evaluation
c. differentiation
d. management

Answers

A key component of strategic management is differentiation, which means how an organization is distinctive from others. Option c is correct answer.

Differentiation is the process of developing unique qualities, features, or attributes that set an organization apart from its competitors. It is a fundamental aspect of strategic management as it enables organizations to create a competitive advantage in the market. By emphasizing their distinctive characteristics, organizations can position themselves as the preferred choice for customers and stakeholders. Differentiation can be achieved through various means, such as product innovation, superior customer service, unique branding, technological advancements, or a focus on specific market segments.

This strategic approach helps organizations stand out from the competition, attract customers, and create long-term value. Through differentiation, organizations can effectively communicate their value proposition and establish a strong market position, leading to increased market share and sustainable success. Therefore, differentiation plays a crucial role in strategic management by defining an organization's distinctiveness and shaping its competitive strategy.

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Skysong Corporation had income from continuing operations of $10,811,000 in 2025 . During 2025, it disposed of its restaurant division at an after-tax loss of $205,400. Prior to disposal, the division operated at a loss of $319,800 (net of tax) in 2025 (assume that the disposal of the restaurant division meets the criteria for recognition as a discontinued operation). Skysong had 10,000,000 shares of common stock outstanding during 2025. Prepare a partial income statement for Skysong beginning with income from continuing operations. (Round eamings per share to 2 decimal places, es. 1.48.)

Answers

The resulting amount is the net income earned by the company.

Partial Income Statement for Skysong Corporation:Year Ended December 31, 2025 (Amounts in Dollars, except earnings per share)Income from Continuing Operations $10,811,000Less: Loss from Discontinued Operations Restaurant Division (319,800)Less: Loss on Disposal of Restaurant Division, net of tax (205,400)Net Income $10,285,800 Earnings per Share of Common Stock Earnings from Continuing Operations Per Share = $10,811,000 / 10,000,000 = $1.08Loss from Discontinued Operations, net of tax = $319,800 - $205,400 = $114,400Net Income Per Share = $10,285,800 / 10,000,000 = $1.03

Skysong Corporation’s partial income statement begins with income from continuing operations, followed by a deduction of the loss from the discontinued operations restaurant division, and then a deduction of the loss on disposal of the restaurant division, net of tax.

To calculate the earnings per share of the company, earnings from continuing operations per share, loss from discontinued operations, and net income per share are calculated, which shows how much each share of the company’s common stock is earning.

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Match the activity to it's correct driver: Activities 1. Inspections A. Number of Custe 2. Set-ups B. Number of ware 3. Distribution C. Background che 1 and A above 3 and C above 3 and B above C and 2 above None of the above

Answers

Matching the activities to their correct drivers: 1. Inspections - C. Background checks 2. Set-ups - B. Number of setups3. Distribution - A. Number of customers So, the correct match is: 3 and C above (Distribution and Background checks).

The activity-driver relationship is based on the cause-and-effect relationship between an activity and the factors that drive or influence it. In this case, background checks (activity) are driven by the number of customers (driver). As the number of customers increases, more background checks need to be performed. This relationship is logical as conducting background checks is a necessary step in ensuring the safety and security of customers.

Similarly, the activity of setups is driven by the number of setups required. As the number of setups increases, the activity of performing setups becomes more frequent and time-consuming. This relationship acknowledges that the workload and time required for setups depend on the number of setups to be completed.

Lastly, distribution activities are driven by the number of warehouses. The more warehouses there are, the greater the need for distribution activities to transport goods from the warehouses to customers. This relationship recognizes that distribution efforts increase as the number of warehouses and the reach of the distribution network expand.

To summarize:

1. Inspections are driven by the need for background checks.

2. Set-ups are driven by the number of setups required.

3. Distribution activities are driven by the number of warehouses.

Therefore, the correct match is 3 and C above (Distribution and Background checks).

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any business that uses the web becomes an international business instantly.

Answers

A web presence can expand the potential reach of a business, it does not automatically make the business an international one.

While any business that utilizes the web can potentially reach a global audience, it does not instantly transform the business into an international one.

Simply having a website or an online presence does not guarantee that the business is actively conducting transactions or operations on an international scale.

The scope and extent of international business activities depend on various factors, such as target markets, customer base, distribution channels, legal considerations, and the ability to serve customers across borders.

Establishing a successful international business typically requires intentional strategies, market research, adaptation to local cultures and regulations, and deliberate efforts to expand operations beyond domestic boundaries.

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Suppose you are going to receive $20,000 per year for 9 years. The appropriate interest rate is 7 percent.
a. What is the present value of the payments if they are in the form of an ordinary annuity?


b. What is the present value if the payments are an annuity due?


c. Suppose you plan to invest the payments for 9 years. What is the future value at the end of Year 9 if the payments are an ordinary annuity?


d. Suppose you plan to invest the payments for 9 years. What is the future value at the end of Year 9 if the payments are an annuity due?

Answers

The present value of the payments in both the ordinary annuity and annuity due cases is approximately $148,516. The future value at the end of Year 9 for both cases is approximately $257,546. Additionally, the future value at the end of Year 9 for both cases is approximately $257,546, accounting for the compounding of the payments.

a. The present value of the payments if they are in the form of an ordinary annuity can be calculated using the formula:

PV = Payment × [(1 - (1 + r)^(-n)) / r]

In this case, the payment is $20,000 per year, the interest rate is 7%, and the number of periods is 9 years. Plugging these values into the formula, we find that the present value is approximately $148,516.

b. The present value if the payments are an annuity due is the same as the present value of an ordinary annuity. Therefore, the present value in this case is also approximately $148,516.

c. To calculate the future value at the end of Year 9 if the payments are invested as an ordinary annuity, we can use the formula:

FV = Payment × [(1 + r)^n - 1] / r

Using the same values as before, we find that the future value is approximately $257,546.

d. The future value at the end of Year 9 if the payments are an annuity due is the same as the future value of an ordinary annuity. Therefore, the future value in this case is also approximately $257,546.

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________ ratios indicate how efficiently the small firm is being managed.
Select one:
a. Leverage
b. Operating
c. Profitability
d. Liquidity

Answers

Operating ratios are financial ratios that provide insights into how efficiently a small firm is being managed in terms of its operations.

The correct answer is b. Operating ratios.

These ratios focus on the company's core business activities and measure its ability to generate profits from its operations. Operating ratios typically include metrics such as:

Gross profit margin: This ratio compares the gross profit (revenue minus the cost of goods sold) to the revenue, indicating how efficiently the firm is generating profits from its production or sale of goods.

Operating profit margin: This ratio measures the operating profit (revenue minus operating expenses) as a percentage of revenue, indicating the firm's ability to generate profits from its core operations.

Return on assets (ROA): This ratio evaluates how effectively the firm is utilizing its assets to generate profits. It compares the net income to the average total assets.

Return on equity (ROE): This ratio assesses the profitability of the firm in relation to the equity invested by the owners. It compares the net income to the average shareholders' equity.

By analyzing operating ratios, one can gain insights into various aspects of a small firm's efficiency, such as its ability to control costs, generate profits, and utilize its assets effectively.

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Suppose that you wish to buy a new home that will cost you $420,000. You must put $84,000 down, and will finance the rest at 4.8% APR, making monthly payments for 30 years at the end of each month. How much of your second payment will be interest? <1344 1344-1346 1346-1348 1348-1350 >1350

Answers

The interest portion of your second payment will be approximately 13,800.26. To calculate the amount of interest in your second payment, we need to determine the remaining principal balance after the first payment.

Loan amount = Cost of the home - Down payment = 420,000 - 84,000 = 336,000

To calculate the monthly payment, we can use the formula for a fixed-rate mortgage:

[tex]M = P * r * (1 + r)^n / ((1 + r)^n - 1)[/tex]

Where:

M = Monthly payment

P = Loan amount

r = Monthly interest rate

n = Number of payments (in months)

Monthly interest rate = Annual interest rate / 12 = 4.8% / 12 = 0.04

Number of payments = 30 years * 12 = 360 months

Plugging the values into the formula:

M = [tex]336,000 * 0.04 * (1 + 0.04)^360 / ((1 + 0.04)^360 - 1)[/tex]

Using a financial calculator or spreadsheet, the monthly payment is approximately 1,605.47.

Now, to determine the interest portion of the second payment, we need to calculate the interest on the remaining principal balance after the first payment.

Principal balance after the first payment = Loan amount - (Monthly payment - Interest portion of the first payment)

Interest portion of the first payment = Loan amount * Monthly interest rate

Interest portion of the first payment = 336,000 * 0.04 = 13,440

Principal balance after the first payment = 336,000 - (1,605.47 - 13,440) = 345,006.53

To calculate the interest portion of the second payment, we multiply the remaining principal balance by the monthly interest rate:

Interest portion of the second payment = Principal balance after the first payment * Monthly interest rate

Interest portion of the second payment = 345,006.53 * 0.04 = 13,800.26

Therefore, the interest portion of your second payment will be approximately 13,800.26.

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what are the dimensions of a piece of printer paper

Answers

The dimensions of a standard piece of printer paper, known as A4 size, are as follows inches, millimeters

Width: 210 millimeters (mm) or 8.27 inches

Height: 297 inches (mm) or 11.69 inches

These dimensions represent the ISO 216 standard for A4 paper, which is widely used in many countries for various printing and documentation purposes. It's worth noting that paper sizes can vary across regions, and other common sizes include Letter (8.5 x 11 inches) used in the United States and Canada, and Legal (8.5 x 14 inches) used primarily for legal documents in the United States.

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(CWA § 404) What is the "water dependency test"?

Answers

According to the question the Clean Water Act (CWA) § 404 requires the "water dependency test.

Section 404 of the Clean Water Act (CWA) provides the legal framework for the issuance of permits for discharges of dredged or fill material into "waters of the United States" (WOTUS), which are regulated by the U.S. Army Corps of Engineers. The § 404 regulations give some guidance on how to define the waters of the United States (WOTUS) and how to identify when a discharge of dredged or fill material into WOTUS is authorized.In order to get a § 404 permit, the applicant must demonstrate that the discharge of dredged or fill material into the waters of the United States will not result in significant adverse environmental effects. The test for assessing whether or not a project meets the above requirements is called the "water dependency test."The water dependency test asks whether the discharge of dredged or fill material is "necessary" for the project to proceed. This involves an assessment of whether the project is water-dependent, which means that it must be located on or near the water in order to function. If the project is not water-dependent, then the discharge of dredged or fill material is considered to be non-necessary, and the permit application will be rejected.

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A physical count of inventory on December 31 resulted in an inventory amount of $198,300; thus, cost of goods sold for 2017 is $1,463,300. Prepare a single-step income statement. 100,000 shares of common stock were outstanding the entire year. (Round earnings per

Answers

An income statement, also known as a profit and loss statement, is a report that shows the company's profits or losses in a certain period of time.

The single-step income statement is a type of income statement where all expenses are combined and subtracted from the total revenue to determine the net income. Here is the solution to your problem.

Physical count of inventory on December 31 = $198,300

Cost of goods sold for 2017 = $1,463,300

Common stock outstanding the whole year = 100,000 shares

The formula to calculate Cost of Goods Sold is:

Cost of Goods Sold = Beginning Inventory + Purchases - Ending Inventory

Cost of Goods Sold = Beginning Inventory + Purchases - Ending Inventory

COGS = $1,198,300 + $310,000 - $198,300

COGS = $1,310,000

Revenue = Cost of Goods Sold + Gross Profit

Revenue = $1,463,300 + Gross Profit

Gross Profit = Revenue - Cost of Goods Sold

Gross Profit = $1,773,300 - $1,310,000

Gross Profit = $463,300

Earnings per share = Net Income / Number of Shares Outstanding

earnings per share = Net Income / Number of Shares Outstanding

Net Income = Revenue - Expenses

Net Income = $1,773,300 - $1,450,000

Net Income = $323,300

Substitute the given values to the single-step income statement.

Single-step income statement:

Revenues:

Sales revenue: $1,773,300

Total revenues: $1,773,300

Expenses:

Cost of goods sold: $1,310,000

Expenses: $140,000

Total expenses: $1,450,000

Net income: $323,300

Earnings per share: $3.233.

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what method of inventory valuation does quickbooks pro use?

Answers

QuickBooks Pro uses the average cost method for inventory valuation. QuickBooks Pro is accounting software used to manage sales and expenses and to keep track of daily transactions. It allows businesses to create invoices, track inventory, prepare reports for planning, and perform payroll functions.

What is the Average Cost Method?

The average cost method is an accounting method for valuing inventory that takes the average cost of all inventory items that have been purchased.

In other words, this method determines the average cost of all goods available for sale and assigns that cost to the units sold. It is a widely used inventory valuation method.

Hence, QuickBooks Pro uses the average cost method for inventory valuation.

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Ceteris paribus, a price increase will cause total revenue to stay the same for a producer only if the price elasticity demand for its product is: Mulviple Choice inelastic Elestic. Unitaryelorte. Exteney high,

Answers

f a price increase causes total revenue to stay the same for a producer, it suggests that the demand for its product is unitary elastic. Unitary elasticity means that the percentage change in quantity demanded is exactly equal to the percentage change in price.

When demand is inelastic (inelastic price elasticity), a price increase leads to a decrease in quantity demanded, resulting in a decrease in total revenue for the producer. This is because the decrease in quantity demanded does not sufficiently compensate for the increase in price.

On the other hand, when demand is elastic (elastic price elasticity), a price increase leads to a larger decrease in quantity demanded, resulting in a decrease in total revenue. The decrease in quantity demanded outweighs the increase in price, leading to a net reduction in total revenue for the producer.

In both cases, a price increase leads to a change in total revenue for the producer. However, if total revenue stays the same, it indicates that the demand for the product is unitary elastic. In this scenario, the decrease in quantity demanded precisely offsets the increase in price, resulting in no net change in total revenue. Therefore, if a price increase causes total revenue to stay the same for a producer, it suggests that the price elasticity of demand for its product is unitary elastic.

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A. To save for retirement, you've decided to save $410 a month at the end of each month during your career. You plan to work for 39 years. Assuming you can earn a 7% return (compounded monthly), how much will you have saved when you retire?

B. Polly has deposited $1,000 in a savings account that pays 4% interest compounded continuously. How much money will she have after 3 years?

C. For a pure-discount loan, your loan balance goes down over time. T/F??

Answers

A) By saving $410 per month for 39 years with a 7% monthly compounded return, you will have saved approximately $1,180,301.39 for retirement.

B) Polly will have approximately $1,124.86 in her savings account after 3 years with a 4% continuously compounded interest rate.

C) False. For a pure-discount loan, the loan balance does not go down over time because no periodic payments are made towards the principal. The borrower receives a lump sum amount upfront and is required to repay the full principal amount at a later date.

A) To calculate the retirement savings, we can use the future value of an ordinary annuity formula. With a monthly contribution of $410 for 39 years at a 7% monthly compounded return, the future value is approximately $1,180,301.39.

B) Continuous compounding is calculated using the formula A = P * e^(rt), where A is the final amount, P is the principal, e is Euler's number (approximately 2.71828), r is the interest rate, and t is the time. Plugging in the values ($1,000, 4%, 3 years), we find that Polly will have approximately $1,124.86 in her savings account after 3 years.

C) False. In a pure-discount loan, the borrower receives a lump sum amount upfront and is required to repay the full principal amount at a later date. There are no periodic payments made towards the principal or interest, so the loan balance remains constant over time until it is fully repaid.

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It is January 9,2015 . The price of a Treasury bond with a 14% coupon that matures on October 12,2015 , is quoted as 102−07. What is the cash price? Q8) It is April 7, 2014. The quoted price of a US government bond with a 8\% per annum coupon (paid semiannually) is 120-00. The bond matures on July 27,2023 . What is the cash price? How does your answer change if it is a corporate bond?

Answers

For the first question, the Treasury bond with a 14% coupon maturing on October 12, 2015, is quoted as 102-07. The cash price of the Treasury bond is 102.21875. To determine the cash price of the US government bond. The cash price of the US government bond is 120.

1. To calculate the cash price of the Treasury bond, we need to convert the quoted price of 102-07 into a decimal. The first part, 102, represents the full points, and the second part, 07, represents the fraction of the points.

We divide the fraction by 32 to convert it into a decimal:

Cash Price = Full Points + (Fraction of Points / 32)

= 102 + (7 / 32)

= 102.21875

Therefore, the cash price of the Treasury bond is 102.21875.

2. To determine the cash price of the US government bond, we use the same method. The quoted price of 120-00 represents 120 full points:

Cash Price = Full Points

= 120

Therefore, the cash price of the US government bond is 120.

If the bond were a corporate bond instead of a government bond, the calculation of the cash price would be the same.

However, the quoted price may reflect different factors such as credit risk and market conditions specific to the corporate issuer.

Therefore, the cash price of a corporate bond could vary based on these factors. It's essential to consider the specific characteristics and creditworthiness of the corporate bond to determine its accurate cash price.

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The government of a poor developing country fears that a political upheaval will occur
unless the growth rate is at least 4 percent per annum. The ICOR and the saving rate are
projected to be υ = 5.0 and s = 14 percent, respectively. Assume the depreciation rate is
1%.
a) Show that 4 percent growth cannot be achieved under these circumstances.
b) With the saving rate as given, what ICOR would be required to achieve the 4 percent
growth target?

Answers

a) 4 percent growth cannot be achieved under the given circumstances because the required investment rate (0.8%) exceeds the available saving rate (14%).

b) With the saving rate of 14 percent, an ICOR of approximately 30.7 percent would be required to achieve the 4 percent growth target.

To determine whether 4 percent growth can be achieved under the given circumstances, we need to calculate the required investment rate and compare it to the available saving rate.

a) Calculation of Investment Rate:

Investment rate (I) = Growth rate (g) / Incremental Capital Output Ratio (ICOR)

Given:

Growth rate (g) = 4%

ICOR (υ) = 5.0

Depreciation rate (δ) = 1%

Investment rate (I) = 0.04 / 5.0 = 0.008 or 0.8%

b) Calculation of Required ICOR:

To achieve the 4 percent growth target with the given saving rate (s) of 14 percent, we can rearrange the investment rate formula to solve for ICOR:

ICOR = Growth rate (g) / Investment rate (I)

Given:

Growth rate (g) = 4%

Saving rate (s) = 14%

Depreciation rate (δ) = 1%

Investment rate (I) = Saving rate (s) - Depreciation rate (δ)

I = 0.14 - 0.01 = 0.13 or 13%

ICOR = 0.04 / 0.13 = 0.307 or 30.7%

Therefore, to achieve the 4 percent growth target with the given saving rate of 14 percent, an ICOR of approximately 30.7 percent would be required.

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A 6.99% coupon, 18.0-year annual bond has a yield to maturity of 3.46%. Assuming the par value is 1,000 and the YTM does not change over the next year, Compute the following:
a) Price of the bond today
b) Price of the bond in one year
c) Capital gains yield :
d) Current Yield

Answers

a) Price of the bond today

Coupon rate = 6.99%

Par value = $1,000

YTM = 3.46%

Time to maturity = 18 years

The price of the bond today can be calculated using the formula,

P = (C × (1 - (1 / (1 + r)ⁿ)) / r) + (FV / (1 + r)ⁿ)

Where,

P = Price of the bond today

C = Annual coupon payment

r = Yield to maturity / Required rate of return

FV = Par value of the bond

n = Time to maturity (in years)

Plugging in the given values,

P = (69.9 × (1 - (1 / (1 + 0.0346)¹⁸))) / 0.0346 + (1,000 / (1 + 0.0346)¹⁸)≈ $1,075.38

Therefore, the price of the bond today is approximately $1,075.38.

b) Price of the bond in one year

Since the YTM does not change over the next year, the bond’s price in one year can be calculated using the formula,

P₁ = C / (1 + YTM) + (FV / (1 + YTM)¹⁷)

Where,

P₁ = Price of the bond in one year

C = Annual coupon payment

FV = Par value of the bond

YTM = Yield to maturity

Plugging in the given values,

P₁ = 69.9 / (1 + 0.0346) + (1,000 / (1 + 0.0346)¹⁷)≈ $1,068.68

Therefore, the price of the bond in one year is approximately $1,068.68.

c) Capital gains yield

The capital gains yield can be calculated as the difference between the bond’s price in one year and the price today, divided by the price today.

That is,(P₁ - P) / P

Where

,P = Price of the bond today

P₁ = Price of the bond in one year

Plugging in the values we have,

P₁ = $1,068.68

P = $1,075.38

Capital gains yield = (1,068.68 - 1,075.38) / 1,075.38≈ -0.62%

Therefore, the capital gains yield is approximately -0.62%.

d) Current Yield

The current yield is the annual coupon payment divided by the price of the bond today, expressed as a percentage.

That is, C / P

Where,

C = Annual coupon payment

P = Price of the bond today

Plugging in the values we have,

C = 69.9

P = $1,075.38

Current Yield = 69.9 / 1,075.38≈ 6.49%

Therefore, the current yield is approximately 6.49%.

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Discuss some of the topics you would include in your formal training and/or employee handbook. Defend why these topics are important to you and your operations.

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In the development of an employee handbook or formal training, it is necessary to include some specific topics. These topics must be related to the company, its policies and procedures, the employee’s job, and responsibilities.

Below are some of the topics that should be included in formal training and/or employee handbook:

1. Expectations and Standards- This topic involves setting expectations and standards for employee behaviour, performance, and job requirements. It provides a guide for employees to understand their responsibilities and obligations to the company.

Attendance and Punctuality- Attendance and punctuality are essential topics in a formal training or employee handbook because it covers the rules and policies surrounding being on time and attendance at work.

Health and Safety- Health and safety are necessary for an employee’s overall well-being and to ensure that they can perform their job duties effectively. It is also important to keep employees safe while at work. It includes basic safety protocols, emergency preparedness, and occupational hazards.

Data Privacy and Security- Data privacy and security should also be included in formal training or employee handbook. It is essential to educate employees on how to protect company data and customer data from unauthorized access or theft.

Professional Conduct- Professional conduct is another important topic for formal training or employee handbook. It sets guidelines for appropriate employee behaviour, including ethical and professional standards.

Employees Benefits and Compensation- The employee benefits and compensation topic is critical to attracting and retaining employees. It is essential to educate employees about the benefits package and how it works. A comprehensive employee benefits package should include health insurance, paid time off, retirement plans, etc.

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a register can be described as an internal document that

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A register can be described as an internal document that serves as a systematic record or log for capturing and organizing information.

It is typically used to maintain and track data related to specific entities, activities, or events within an organization. The register is designed to provide an organized and centralized repository of information, ensuring easy access, retrieval, and analysis. It may contain details such as names, dates, descriptions, reference numbers, and other relevant data, depending on its purpose. Registers can be utilized in various domains, including finance, inventory management, customer records, project tracking, compliance, and more.

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Ephraim Khoza is a shift supervisor at the Safe and Clean Stores and as such, he is responsible for day-today activities and short-term planning for his section. As a shift supervisor within the store, Ephraim is a member of management. Select one: a. functional b. top c. middle d. Iower When Vusi Thembekwayo, the CEO of a boutique investment and advisory firm in Africa evaluates business proposals from aspiring entrepreneurs, he is fulfilling a/an role. Select one: a. interpersonal b. decision-making c. managerial d. information Which one of the following statements is wrong? Management is necessary to Select one: a. keep the operations of an enterprise on a balanced course. b. keep the organisation in equilibrium with its environment. c. direct an organisation towards its goals. d. attain organisational goals at the lowest possible productivity levels. Question 19 Marked out of 1.00 Should Vodacom attempt to adapt the available techniques and principles provided by the various management approaches to a given situation in order to reach its objectives, it would be applying Select one: a. the contingency approach to management b. diversity management c. the scientific school of management d. the quantitative school of management Question 20 Marked out of 1.00 You are working for Shoprite as a teller and get promoted to a line management position where you are responsible for guiding your subordinates and for keeping close control over their activities. You are therefore part of management. Select one: a. top b. middle c. lower d. functional

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The given statements can be explained as follows: Ephraim Khoza is a Shift supervisor at the Safe and Clean Stores and as such, he is responsible for day-to-day activities and short-term planning for his section.

As a shift supervisor within the store, Ephraim is a member of management. The shift supervisor is a member of middle management. When Vusi Thembekwayo, the CEO of a boutique investment and advisory firm in Africa evaluates business proposals from aspiring entrepreneurs, he is fulfilling a/an role. The CEO is fulfilling a decision-making role.

One of the following statements is wrong, attain organizational goals at the lowest possible productivity levels. Management is necessary to keep the operations of an enterprise on a balanced course, direct an organization toward its goals and keep the organization in equilibrium with its environment.

Should Vodacom attempt to adapt the available techniques and principles provided by the various management approaches to a given situation in order to reach its objectives, it would be applying the contingency approach to management. Shoprite tellers who got promoted to line management positions where they are responsible for guiding the subordinates and keeping close control over their activities are a member of middle management.

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Which of the following is not an aspect of the institutionalization of social responsibility?
a. Voluntary practices
b. Legal responsibilities
c. Core practices
d. Familial responsibilities
e. Strategic philanthropy

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Familial responsibilities is not an aspect of the institutionalization of social responsibility. Therefore the correct option is option d.

Social responsibility is the obligation an organization's management has to make decisions and do things that benefit society at large. Social responsibility extends beyond the legal requirement to follow laws and regulations and is determined by ethical concerns and the spirit of the law. Social responsibility is the organization's approach to creating positive change while maintaining ethical practices in all of its operations.

Institutionalization of social responsibility: Institutionalization of social responsibility refers to the methods and processes that businesses use to meet their social responsibilities. Following are the aspects of the institutionalization of social responsibility: Voluntary practices, Legal responsibilities, Core practices, Strategic philanthropy. Familial responsibilities is not an aspect of the institutionalization of social responsibility. Option d.

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Employment application forms are usually discarded when the applicant is hired.

a. true
b. false

Answers

The statement "Employment application forms are usually discarded when the applicant is hired" is typically false.

Once an individual is employed, their application form is often stored in their personal file and may be reviewed by the employer from time to time. However, employers may discard employment application forms in some cases such as when the applicant is not suitable for the job, or if the job post is not open, or if the company is not recruiting more workers. This may vary based on the employer's policy, but it's generally not a regular practice to discard employment application forms once an applicant is hired. Therefore, the correct option is option b. false.

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David would like to make a single payment of $2000 at the end of year 7 so that it will be equivalent to payments of $100, $1000, and $900 made at the ends of years 1, 12, and X years, respectively. Assuming an effective rate of interest of 5% per annum and the method of equated time, solve for X. Round your answer to 2 decimal places.

Answers

The value of X that solves the equation is approximately 14.21 years

To solve for X in this scenario, we can use the concept of equated time value of money. The idea is to find the value of the single payment of $2000 at the end of year 7 that is equivalent to the payments made at different time periods using an effective rate of interest of 5% per annum.

Let's start by finding the present value of each payment using the formula:

Present Value = Payment / (1 + Interest Rate)^Number of Periods

For the payment of $100 made at the end of year 1, the present value is:

PV1 = $100 / (1 + 0.05)^1 = $100 / 1.05 = $95.24

For the payment of $1000 made at the end of year 12, the present value is:

PV2 = $1000 / (1 + 0.05)^12 = $1000 / 1.7989 = $556.20

For the payment of $900 made at the end of year X, the present value is:

PV3 = $900 / (1 + 0.05)^X

Now, we want the present value of the single payment of $2000 made at the end of year 7 to be equivalent to the sum of PV1, PV2, and PV3:

$2000 = PV1 + PV2 + PV3

Substituting the calculated present values, we have:

$2000 = $95.24 + $556.20 + ($900 / (1 + 0.05)^X)

Simplifying the equation and solving for X requires algebraic manipulation:

$448.56 = $900 / (1.05)^X

Dividing both sides by $448.56 gives us:

1 = (1.05)^X / 2

Taking the logarithm of both sides, we have:

log(1) = log[(1.05)^X / 2]

0 = X * log(1.05) - log(2)

Solving for X, we get:

X = log(2) / log(1.05)

Calculating this using a calculator, X ≈ 14.21 (rounded to two decimal places).

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A California grower has a 50-acre farm on which strawberries and
tomatoes are planted. The profit contribution from an acre of
Strawberries is $400and the profit contribution from an acre of
Tomatoes

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The 50-acre farm in California grows strawberries and tomatoes, with each acre of strawberries generating a profit contribution of $400. However, the profit contribution from an acre of tomatoes is not specified.

The given information states that the farm has a total of 50 acres of land, on which strawberries and tomatoes are grown. The profit contribution from each acre of strawberries is $400. Unfortunately, the profit contribution from an acre of tomatoes is not provided. Without knowing the profit contribution from tomatoes, it is challenging to determine the overall profitability of the farm or make any conclusive statements about its financial performance.

To fully evaluate the farm's profitability, it is crucial to have the profit contribution per acre for tomatoes as well. Additionally, other factors such as production costs, market demand, and seasonal variations can further influence the profitability of the farm.

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Using segmentation by size, which type of organization would least likely be contacted by email or outbound telemarketing? A) Small business B) Large firm C) Medium size business D) Government entity 54) The product positioning strategy based on how a product "protects your car's interior" showing how it provides a shield is based on: A) use or application B) a cultural symbol C) competitors D) price-quality relationship 68) When a product positioning strategy targets consumers that want convenience, which positioning approach is being used? A) price-quality B) product class C) cultural symbol D) use or application 82) If Johnson \& Johnson notices that another company has spent more on advertising to seniors, and the marketing team moves to increase its advertising spending by 10% for that market, which approach to budgeting is being used? A) What we can afford B) Meet the competition C) Percentage of sales D) Payout planning 75) Academy Sports + Outdoors uses certain indicators that are studied in relation to the degree of change following an online promotional campaign. Each indicator is an example of a: A) marginal analysis. B) standardized measure. C) post-hoc analysis. D) benchmark measure. 65) If Subaru advertises, "our cars are rated safer than all other brands by Car and Driver magazine" the positioning approach would be: A) product characteristics B) competitor based C) use or application D) price-quality relationship.

Answers

1.Using segmentation by size, type of organization least likely contacted by email or outbound telemarketing would be D) Government entity.

2. The product positioning strategy based on how product "protects your car's interior" showing how it provides a shield is based on A) use or application.

3. When a product positioning strategy targets consumers that want convenience, the positioning approach being used is D) use or application.

4. If Johnson & Johnson notices that another company has spent more on advertising to seniors approach to budgeting being used is B) Meet the competition.

5. The indicators studied by Academy Sports + Outdoors in relation degree change following an online promotional campaign are an example of D) benchmark measures.

6. If Subaru advertises, "our cars are rated safer than all other brands by Car and Driver magazine," the positioning approach would be B) competitor-based.

Government plays a crucial role in society and holds significant importance for several reasons. Firstly, it provides a framework for establishing and enforcing laws, and policies that promote social order, stability, and justice. Government institutions also safeguard public safety, protect individual rights, and ensure the overall well-being of citizens. Additionally, governments facilitate economic development by creating a favorable business environment, implementing monetary and supporting infrastructure initiatives.

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When the central bank buys an asset from the public, ________ in central bank liabilities associated with the asset purchase causes the money supply to ________. When the central bank sells an asset to the public, ________ in central bank liabilities causes the money supply to ________.

A) an increase; expand; a decrease; shrink

B) a decrease; shrink; an increase; expand

C) an increase; shrink; a decrease; expand

D) a decrease; expand; an increase; shrink

Answers

When the central bank buys an asset from the public, an increase in central bank liabilities associated with the asset purchase causes the money supply to expand.

Conversely, when the central bank sells an asset to the public, a decrease in central bank liabilities causes the money supply to shrink.

When the central bank buys an asset from the public, such as government bonds, it increases its liabilities by creating reserves for the seller. This increase in central bank liabilities expands the money supply because the reserves held by the seller can be used to make additional loans or payments, thereby increasing the amount of money in circulation.

On the other hand, when the central bank sells an asset to the public, it decreases its liabilities by reducing reserves. This reduction in central bank liabilities leads to a contraction of the money supply because the reserves held by the buyer are removed from circulation, reducing the amount of money available for lending or spending.

Therefore, the correct answer is:

A) an increase; expand; a decrease; shrink

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Would the globalisation of those industries have been possible
without the pace and size of these technological changes? Ensure
you provide examples to support your elaboration.

Answers

The globalisation of industries has been greatly facilitated by the rapid and substantial technological changes that have taken place. These technological advancements have opened up new possibilities and opportunities for businesses to expand their operations and reach a global scale.

Here are some examples that illustrate the impact of technological changes on the globalisation of industries:

1. Communication Technology: The development of advanced communication technologies, such as the internet, mobile phones, and video conferencing, has revolutionised the way businesses connect and interact with people around the world. Companies can now easily communicate with customers, suppliers, and partners across different continents, enabling them to establish global networks and expand their reach.

2. Transportation Technology: Technological advancements in transportation, including faster and more efficient modes of travel and shipment, have made it easier for industries to transport goods and services across borders. Improved logistics systems, containerization, and air freight have reduced transportation costs and time, making it feasible for businesses to operate globally and serve international markets.

3. Digital Technology: The rise of digital technology has transformed various industries and provided new avenues for global expansion. E-commerce platforms have enabled businesses to sell products and services online, reaching customers worldwide without the need for physical stores or local presence. This has allowed small and medium-sized enterprises to access global markets and compete with larger corporations.

4. Information Technology: The availability of vast amounts of information through the internet and digital databases has empowered businesses to gather market intelligence and make informed decisions about global expansion. Access to real-time data on consumer preferences, market trends, and competitor analysis has facilitated strategic planning and entry into new markets.

5. Social Media and Digital Marketing: Social media platforms have become powerful tools for businesses to engage with global audiences, build brand awareness, and target specific markets. Through social media marketing and digital advertising, companies can reach potential customers worldwide, creating a global presence and expanding their customer base.

In conclusion, technological changes have played a vital role in driving the globalisation of industries. The advancements in communication, transportation, digital technology, information technology, and marketing have provided businesses with the means to operate on a global scale, connect with international markets, and seize opportunities for growth and expansion.

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Which of the following statements is/are most likely wrong? (one or multiple answers)
Enterprise Value multiple:
a) is applicable to the comparisons of companies with significantly different capital structures.
b) is not appropriate for comparing companies with significantly different capital structures
c) is likely to experience the negative earnings problem because of the use of EBITDA.
d) is incapable of reflecting the real economic value of a company.
e) reflects the real economic value of a company

Answers

Option (e) reflects the real economic value of a company is the most likely wrong statement among the given choices.

Enterprise value multiple (EV) is a ratio used in fundamental analysis, business valuation, and corporate finance. This ratio compares the enterprise value (EV) of a company to some other financial metric such as earnings before interest, taxes, depreciation, and amortization (EBITDA) or revenue. The EV/EBITDA metric is used to determine the worth of a business, where a lower ratio can indicate undervaluation and a higher ratio can indicate overvaluation.In a way, an enterprise value multiple reflects the real economic value of a company and hence option (e) is the most likely wrong statement among the given choices.The other statements are correct:a) is applicable to the comparisons of companies with significantly different capital structures.b) is not appropriate for comparing companies with significantly different capital structuresc) is likely to experience the negative earnings problem because of the use of EBITDA.d) is incapable of reflecting the real economic value of a company.

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Draw a mind map :HRD management function in the organisation. Pay attention to the characteristic of a good mind map below.
1. Place the main idea in the middle.
2. Place the important facts closest to the main idea.
3. Place the unimportant facts further from the main idea.
4. Use concise descriptions.
5. Connect the lines.
6. Colour groups.
7. Number each section or nranch/link.

Answers

A mind map illustrating the HRD (Human Resource Development) management function in an organization is provided. The mind map follows the characteristics of a good mind map, including placing the main idea in the middle, arranging important facts closest to the main idea, using concise descriptions, connecting lines, color-coding groups, and numbering each section or branch/link.

To create a mind map for the HRD management function, start by placing "HRD Management" in the middle as the main idea. Connect lines outward from the main idea and add important facts related to HRD management, such as employee training and development, performance management, talent acquisition, career planning, and organizational learning. Ensure that important facts are placed closer to the main idea, while less significant details are positioned further away. Use concise descriptions or keywords for each section and consider color-coding different groups or categories within HRD management. Finally, number each section or branch/link to create a clear structure.

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