The price of the asset would increase by approximately 0.91%. Allocate 36.84% to the zero-coupon bond and 63.16% to the perpetuity bond. The duration of the 8% coupon bond at 7.2% YTM is 2.7356 years, and at 11.2% YTM is 2.4141 years.
If the interest rate decreases by 15 basis points, the price of the asset would go up by approximately 0.91% due to its duration of 6 years. To achieve a target duration of 19 years in the portfolio, allocate 36.84% to the zero-coupon bond and 63.16% to the perpetuity bond. If the target duration becomes 18 years, the allocation percentages will change to 38.88% for the zero-coupon bond and 61.12% for the perpetuity bond. The duration of the 8% coupon bond with a 7.2% yield to maturity is 2.7356 years, and at a 11.2% yield to maturity, the duration is 2.4141 years.
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Mr. Hankey's Portable Toilets Inc. uses the residual dividend model to set its dividends. Selected financial information for Mr. Hankey's is provided in the table below. Net Income Equity Capital Structure Weight Shares Outstanding How many additional funds does Mr. Hankey need to borrow in order to support its new investments? 27.5M, 10M 27.5M, 11M O 16.5M, 10M Selected Financial Information Mr. Hankey's Portable Toilets Inc. 16.5M, 11M $16.50 million 0.6 1 million
The additional funds that Mr. Hankey's Portable Toilets Inc. needs to borrow in order to support its new investments, we need information about the capital structure and the equity of the company.
The capital structure weight is given as 0.6, which represents the proportion of the company's financing that comes from equity. The equity is provided as $16.50 million. We also have the information that the company has 1 million shares outstanding.
To calculate the additional funds needed to support new investments, we can use the formula:
Additional funds = (New investments - Equity) / (1 - Capital structure weight)
Given the information provided, the equation becomes:
Additional funds = (10 million - 16.50 million) / (1 - 0.6) = -6.5 million / 0.4 = -16.25 million
The negative value indicates that Mr. Hankey's Portable Toilets Inc. has excess equity capital to cover its new investments and does not need to borrow additional funds.
Therefore, the answer is: $0 (Mr. Hankey's does not need to borrow additional funds).
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On june 1, the company collected $4,200 cash, which is for services to be performed over the next 12 months. For the following two separate cases, prepare the adfusting entry. determine the balance of Deferred Service Revenue at year-end. Case A: $4,200 was credited to Service Revenue during the year. Case $:$4,200 was credited to Deferred Service Revenue during the year. Balance of Deferred service Rievenwe at year-end: Dulisg the current year, stipplies were purchased for $375 cash. The inventory of supplies at the pricr year end was 375 . At the current year-end inventory remairing was st 20 . Fir the folsowing two separath cases. prepare the adjusting entry and determine the balance of supplies at year-end. Care A: 337. Was debled to tupples fypense during the year. Case 8 : 1375 was debited to supplies during the year.
Previous question
Case A:
In Case A, since $4,200 was credited to Service Revenue during the year, no balance of Deferred Service Revenue will exist at the year-end as the money was immediately recognized. The adjusting entry will be:
$4,200 Service Revenue
$4,200 Deferred Service Revenue
Case B:
In Case B, since $4,200 was credited to Deferred Service Revenue during the year, the balance of Deferred Service Revenue at year-end will be $4,200. The adjusting entry will be:
$4,200 Deferred Service Revenue
$4,200 Service Revenue
Balance of Deferred Service Revenue at year-end = $4,200
Regarding the supplies:
Case A:
In Case A, the inventory of supplies at the prior year-end was $375, and at the current year-end, the remaining inventory was $20. Since $375 was debited to Supplies Expense during the year, the adjusting entry will be:
$355 Supplies Expense
$355 Supplies
Case B:
In Case B, since $1,375 was debited to Supplies during the year, the adjusting entry will be:
$1,375 Supplies
$1,375 Supplies Expense
Balance of Supplies at year-end = $20
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Discuss the common characteristics of successful interventions.
Briefly discuss the elements of successful change management
Interventions refer to the measures that are taken to create changes that improve the functioning of individuals, groups, or organizations. Successful interventions possess several common characteristics. The most common characteristics of successful interventions are as follows:It is an evidence-based approach which is implemented by trained and experienced professionals.
Addressing these barriers is critical to the success of the change process.Monitoring and evaluating the change process is essential to determine whether the change has been successful and whether any adjustments need to be made. This will help to ensure that the change is sustainable and that it continues to produce positive results over time.
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Difference between Output, Behavioral and clan control, ( which
control is good for a sales force?)
Output, behavioral, and clan control are all methods of controlling activities within an organization. Output control involves controlling the end results of a business process. Behavioral control is the use of personal observation to control employee behavior.
Clan control is the use of organizational culture to control employee behavior.Each control method has its advantages and disadvantages, and their suitability depends on the nature of the organization and the job being performed. Output control is ideal for sales forces that work independently. Behavioral control is ideal for jobs that require consistent performance, such as sales or customer service. Clan control is ideal for organizations with a strong culture that values teamwork and employee participation.In general.
It provides clear targets and measures for evaluating performance, making it easy to track progress. However, the use of output control can lead to a focus on short-term gains at the expense of long-term growth. It may also lead to a lack of innovation and creativity as employees focus solely on meeting targets.
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A technician monitors a group of 7 computers that run an automated manufacturing facility. It takes an average of 15 minutes (negative exponentially distributed) to adjust a computer that develops a problem. On average, one of the computers requires adjustment every 70 minutes (Poisson distributed). a) Determine the average number of computers waiting for adjustment (i.e., in the queue). The average number of computers waiting in the queue is (Round your response to two decimal places.)
To determine the average number of computers waiting in the queue, we need to calculate the average number of arrivals and the average service rate.
Given:
The average time between computer problems (arrival rate) follows a Poisson distribution with an average of 1/70 per minute.
The average time to adjust a computer (service rate) follows a negative exponential distribution with an average of 15 minutes.
We can use the M/M/1 queuing model, where M represents Poisson arrivals, M represents exponential service times, and 1 represents a single server.
The utilization factor (ρ) is given by the arrival rate (λ) divided by the service rate (μ):
ρ = λ / μ
The arrival rate (λ) is the reciprocal of the average time between computer problems:
λ = 1 / 70
The service rate (μ) is the reciprocal of the average time to adjust a computer:
μ = 1 / 15
Now, we can calculate the utilization factor (ρ):
ρ = (1 / 70) / (1 / 15) = 15 / 70 = 3 / 14
The average number of computers waiting in the queue (Lq) is given by:
Lq = ρ^2 / (1 - ρ)
Substituting the value of ρ, we can calculate Lq:
Lq = (3 / 14)^2 / (1 - 3 / 14) ≈ 0.0918
Therefore, the average number of computers waiting in the queue is approximately 0.09 (rounded to two decimal places).
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Consider the three-player game G with the payoffs given in Table 1. (Player 1 may choose Table 1: Payoffs of G U D L R L R N (2, 1, 2) (2, 1, 2) (0,0,0) (0,0,0) E (1,0,1) (1, 0, 1) (2,1,2) :) ( W (2, 1, 2) (2,1,2) (2, 1, 2) (1, 0, 1) (0, 0, 0) (2, 1, 2) (0, 0, 0) S (1,0,1) (2,1,2) each of the rows N, E, W, S, Player 2 each of the columns L, R, and Player 3 each of the two matrices U, D.) Let (p, q, r, s), (y, 1-y), and (z, 1-2) be typical mixed strategies of Player 1, Player 2, and Player 3, respectively. Show that there is a unique pair ((y, 1-y), (z, 1-z)) of mixed strategies of 2 and 3 such that Player 1 is indifferent between all rows. (Hint: Player 2 must guarantee that 1 is indifferent between W and S, and 3 must guarantee that 1 is indifferent between N and E).
The unique pair ((y, 1-y), (z, 1-z)) of mixed strategies for Players 2 and 3 that satisfies the conditions is ((1/2, 1/2), (1/2, 1/2)).
To find the unique pair ((y, 1-y), (z, 1-z)) of mixed strategies for Players 2 and 3, we need to satisfy the conditions that Player 1 is indifferent between all rows. Let's analyze the payoffs for each row and derive the necessary equations.
For Row N:
Player 1's expected payoff is:
(p * (2, 1, 2)) + (q * (2, 1, 2)) + (r * (0, 0, 0)) + (s * (0, 0, 0))
For Row E:
Player 1's expected payoff is:
(p * (1, 0, 1)) + (q * (1, 0, 1)) + (r * (2, 1, 2)) + ((1 - p - q - r) * (0, 0, 0))
For Row W:
Player 1's expected payoff is:
(p * (2, 1, 2)) + (q * (2, 1, 2)) + ((1 - p - q) * (2, 1, 2))
For Row S:
Player 1's expected payoff is:
(p * (1, 0, 1)) + (q * (2, 1, 2)) + (r * (1, 0, 1)) + ((1 - p - q - r) * (0, 0, 0))
To make Player 1 indifferent between the rows N and E, we can equate their expected payoffs:
(p * (2, 1, 2)) + (q * (2, 1, 2)) + (r * (0, 0, 0)) + (s * (0, 0, 0)) = (p * (1, 0, 1)) + (q * (1, 0, 1)) + (r * (2, 1, 2)) + ((1 - p - q - r) * (0, 0, 0))
Simplifying this equation, we get:
(p + q - r) = 0 -- Equation 1
To make Player 1 indifferent between the rows N and W, we can equate their expected payoffs:
(p * (2, 1, 2)) + (q * (2, 1, 2)) + (r * (0, 0, 0)) + (s * (0, 0, 0)) = (p * (2, 1, 2)) + (q * (2, 1, 2)) + ((1 - p - q) * (2, 1, 2))
Simplifying this equation, we get:
(r - s) = 0 -- Equation 2
To make Player 1 indifferent between the rows N and S, we can equate their expected payoffs:
(p * (2, 1, 2)) + (q * (2, 1, 2)) + (r * (0, 0, 0)) + (s * (0, 0, 0)) = (p * (1, 0, 1)) + (q * (2, 1, 2)) + (r * (1, 0, 1)) + ((1 - p - q - r) * (0, 0, 0))
Simplifying this equation, we get:
(p + s - r) = 0 -- Equation 3
Now, let's consider Player 2's mixed strategy: (y, 1-y)
To make Player 1 indifferent between the outcomes W and S, Player 2 must guarantee that the expected payoffs for these two actions are equal:
(y * (2, 1, 2)) + ((1 - y) * (2, 1, 2)) = (y * (1, 0, 1)) + ((1 - y) * (2, 1, 2))
Simplifying this equation, we get:
y = 1 - y -- Equation 4
Now, let's consider Player 3's mixed strategy: (z, 1-z)
To make Player 1 indifferent between the outcomes N and E, Player 3 must guarantee that the expected payoffs for these two actions are equal:
(z * (2, 1, 2)) + ((1 - z) * (0, 0, 0)) = (z * (1, 0, 1)) + ((1 - z) * (2, 1, 2))
Simplifying this equation, we get:
z = 1 - z -- Equation 5
Now we have a system of equations (Equations 1, 2, 3, 4, and 5) that we can solve to find the unique values of y and z. Solving Equations 4 and 5 gives us:
y = 1 - y
2y = 1
y = 1/2
z = 1 - z
2z = 1
z = 1/2
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A Rubis petrol station in Papine has hired a Utech graduate, Derval Watts to bring some order to the chaos that existed in the ordering and inventory control of lubricants. Derval called the finance department and was told that for the purpose of his analysis, the appropriate holding cost for lubricants is 24% per year. The demand per month is 208 cases. At a cost of $6.32 per case, the cost for ordering the lubricants is estimated to be $83 per order. Lead time is 5 days and petrol station is opened every day except Christmas day. a) How many cases of lubricants do you recommend that Derval orders every time he places an order. b) Determine the estimated holding cost; and ordering cost 4 c) Would it be true to say it takes Derval approximately 76 days between orders. Justify your answer d) How many orders will Derval have placed each year e) Determine the re-order point f) What can Derval expect his Total Annual cost to be
Answer:
Explanation:a) To determine the optimal order quantity, we can use the economic order quantity (EOQ) formula:
EOQ = sqrt((2 * demand * ordering cost) / holding cost)
EOQ = sqrt((2 * 208 * $83) / 0.24) ≈ 165 cases
Therefore, Derval should order approximately 165 cases of lubricants every time he places an order.
b) The estimated holding cost can be calculated using the formula:
Holding Cost = (EOQ / 2) * holding cost per case
Holding Cost = (165 / 2) * ($6.32 * 0.24) ≈ $119.23
The ordering cost is given as $83 per order.
c) No, it would not be true to say it takes Derval approximately 76 days between orders. To calculate the time between orders, we need to consider the lead time and the number of days the petrol station is open:
Days between orders = (EOQ / demand) * (lead time + 1) / (days open per month)
Days between orders = (165 / 208) * (5 + 1) / (30 - 1) ≈ 3.51 days
So, it takes Derval approximately 3.51 days between orders, not 76 days.
d) The number of orders Derval will have placed each year can be calculated by dividing the number of working days in a year by the days between orders:
Number of orders = 365 / (Days between orders)
Number of orders = 365 / 3.51 ≈ 104 orders
Therefore, Derval will place approximately 104 orders per year.
e) The reorder point is the level of inventory at which a new order should be placed. It can be calculated as:
Reorder Point = (demand * lead time) / (days open per month)
Reorder Point = (208 * 5) / (30 - 1) ≈ 35.86 cases
So, the reorder point is approximately 35.86 cases.
f) The total annual cost can be calculated by summing the ordering cost, holding cost, and the cost of purchasing the lubricants:
Total Annual Cost = (ordering cost * number of orders) + holding cost + (demand * cost per case)
Total Annual Cost = ($83 * 104) + $119.23 + (208 * $6.32)
Total Annual Cost ≈ $8,632.32
Therefore, Derval can expect his total annual cost to be approximately $8,632.32.
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Why would a decisionmaker use the profitability index? (3 points) Q2. What is the tradeoff between profitability and liquidity and profitability and risk in working capital management? (4 points) Q3. Explain undiversifiable risk (market risk) and provide examples of undiversifiable risk. (3 points)
The profitability index is a financial metric used to evaluate the attractiveness of an investment project. Decision-makers use the profitability index for the following reasons:
1. Investment Selection: The profitability index helps decision-makers compare and prioritize different investment opportunities. By calculating the index for multiple projects, decision-makers can identify the projects that offer the highest returns relative to their costs.
2. Resource Allocation: The profitability index assists in allocating limited resources effectively. Decision-makers can allocate resources to projects with higher profitability indexes, maximizing the overall return on investment.
3. Risk Assessment: Decision-makers can use the profitability index to assess the risk-reward trade-off of investment projects. Projects with higher profitability indexes may indicate higher potential returns, but decision-makers should also consider the associated risks to make informed investment decisions.
The tradeoff between profitability and liquidity in working capital management refers to the balancing act between maximizing profitability and maintaining sufficient liquidity to meet short-term obligations. Here are some key points regarding this tradeoff:
1. Profitability vs. Liquidity: To maximize profitability, a company may choose to invest its working capital in income-generating activities such as inventory, production, or expansion. However, tying up too much capital in long-term assets can lead to reduced liquidity, making it challenging to meet short-term financial obligations.
2. Risk vs. Profitability: Higher profitability often comes with increased risk. For example, investing in high-risk assets or extending credit to customers with a higher default probability may yield higher profits. However, there is also a greater likelihood of financial losses if the risks materialize. Decision-makers need to strike a balance between pursuing higher profitability and managing the associated risks.
3. Optimal Working Capital: Effective working capital management aims to find the right balance between profitability, liquidity, and risk. It involves optimizing the levels of inventory, accounts receivable, and accounts payable to ensure sufficient liquidity while maximizing profitability and mitigating risks.
Undiversifiable risk, also known as market risk or systematic risk, refers to the portion of risk inherent in an investment that cannot be eliminated through diversification. It is the risk associated with the overall market or economy and affects all investments to some extent. Here are some examples of undiversifiable risk:
1. Market Fluctuations: Changes in macroeconomic factors such as interest rates, inflation, or economic conditions can impact the overall market and affect the value of investments across different sectors and industries. For example, during an economic recession, stock prices tend to decline, affecting all investors regardless of the specific companies or sectors they are invested in.
2. Political and Regulatory Factors: Political instability, changes in government policies, or new regulations can introduce uncertainties and affect the value of investments. For instance, a sudden change in tax laws or regulations in a specific industry can impact the performance of all companies operating in that sector.
3. Natural Disasters: Events such as earthquakes, hurricanes, or pandemics can have widespread effects on financial markets and various industries. These events introduce systemic risks that impact investments regardless of diversification efforts.
It is important to note that undiversifiable risk cannot be eliminated through diversification because it is inherent in the overall market or economy. Investors can only manage this risk through risk management techniques like asset allocation, hedging, or adopting strategies that align with their risk tolerance and investment objectives.
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summary on Process Strategy and Sustainability and Capacity
Management and Quality Control and Statistical Process Control and
forecasting
Process strategy and sustainability, capacity management, quality control, statistical process control, and forecasting are essential components of effective operations management in businesses.
Process strategy and sustainability involve designing and optimizing operational processes to achieve efficiency, productivity, and environmental sustainability. It includes streamlining workflows, eliminating waste, and adopting sustainable practices to reduce the environmental impact of operations. This strategy ensures that processes are aligned with business objectives while considering long-term sustainability goals.
Capacity management focuses on determining and managing the optimal level of resources, such as facilities, equipment, and labor, to meet customer demand efficiently. It involves forecasting demand, analyzing production capabilities, and making informed decisions to balance capacity and demand to minimize costs and maximize customer satisfaction.
Quality control is the process of ensuring that products or services meet established quality standards. It involves monitoring and inspecting the production process, conducting quality checks, and implementing corrective actions when deviations occur. Quality control measures are crucial to maintaining customer satisfaction, reducing defects, and enhancing overall product or service quality.
Statistical process control (SPC) is a methodology that uses statistical techniques to monitor and control the production process. It involves collecting and analyzing data in real-time to identify variations and trends, allowing for timely intervention and process adjustments to maintain desired quality levels.
By integrating these components into their operations management practices, businesses can optimize processes, ensure consistent quality, manage capacity efficiently, and make informed decisions to meet customer demands while considering sustainability and long-term growth objectives.
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What personal responsibility do you have if you are allowed to use your own person devices to access corporate or company networks, data, and software programs?
How has the ability to maintain one's privacy changed over the past 5-7 years?
As an employee who has been allowed to access the company's network, data, and software programs using your personal devices, you have several personal responsibilities.
In this case, you are responsible for ensuring the following:Your devices are secure: You should ensure that your personal devices are secure and updated with antivirus and other relevant software to prevent unauthorized access to company information.Your activities are secure: You should ensure that your activities on the company network are secure and confidential. This includes ensuring that you don't share company information through personal email or other channels.
Governments around the world have responded to these concerns by implementing regulations that require companies to protect personal information and provide individuals with greater control over their data.
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Ellis Company issues 9.0%, five-year bonds dated January 1, 2021, with a $550,000 par value. The bonds pay interest on June 30 and December 31 and are issued at a price of $560,995. The annual market rate is 8.5% on the issue date.
Required:
1. Compute the total bond interest expense over the bonds' life.
2. Prepare an effective interest amortization table for the bonds' life.
3. Prepare the journal entries to record the first two interest payments.
To calculate the total bond interest expense over the bonds' life, you need to determine the interest payments and the premium or discount amortization.
Total Bond Interest Expense: The total bond interest expense over the bonds' life can be calculated by summing up the interest payments and the premium or discount amortization. To compute the interest payments, multiply the par value ($550,000) by the stated interest rate (9.0%) and the time period (5 years). To calculate the premium or discount amortization, subtract the issue price ($560,995) from the par value and allocate it over the bond's life using the effective interest method.
Effective Interest Amortization Table: An effective interest amortization table can be prepared to track the interest expense, interest payment, and amortization of premium or discount over the bond's life. The table will include the period, beginning carrying value, interest expense, interest payment, premium or discount amortization, and ending carrying value. It will be used to calculate the interest expense and amortization for each period.
Journal Entries for Interest Payments: To record the first two interest payments, you would debit the interest expense account for the amount of interest expense calculated for each period and credit the cash account for the actual interest payment made.
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Please write 100 words explaining what you learned from the podcast(The Secret Document That Transformed China) on economic reform in China, specifically how it relates to the Solow model.
The podcast titled “The Secret Document That Transformed China” sheds light on the economic reforms that took place in China after the death of Chairman Mao. The main answer to the question about the Solow model is that the economic reforms in China in the 1980s and 1990s reflect the assumptions of the Solow model regarding capital accumulation and productivity growth.
The Solow model is a macroeconomic model that explains economic growth over time in terms of changes in productivity, labor, and capital. According to the Solow model, a country’s output depends on the amount of capital and labor available, as well as on the level of productivity. In the context of China, the economic reforms aimed to increase capital accumulation and productivity growth through various policies such as market liberalization, privatization, and foreign investment.
The podcast highlights how the Chinese leadership under Deng Xiaoping recognized the need for economic reform to improve the country’s economic growth. The government implemented policies that encouraged foreign investment and allowed for market liberalization, and privatization of state-owned enterprises. These policies led to an increase in capital accumulation and productivity growth, which are key components of the Solow model. As a result of these policies, China’s economy has grown rapidly over the past few decades, making it one of the largest economies in the world.
The Solow model assumes that technology and capital accumulation are the main drivers of economic growth, and the Chinese government’s policies align with these assumptions. The government’s focus on increasing capital accumulation through foreign investment and privatization, and improving productivity through market liberalization and technological innovation reflects the assumptions of the Solow model.
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Q. Discuss
the concept of learning organization as given by Peter Senge. What
are the five important disciplines necessary for a true learning
organization.
Peter Senge is considered the pioneer of the concept of the learning organization. He defines the learning organization as one that is skilled in creating, acquiring, and transferring knowledge and at modifying its behavior to reflect new knowledge and insights.
The five important disciplines necessary for a true learning organization according to Peter Senge are:1. Systems ThinkingThe first discipline necessary for creating a learning organization is systems thinking. It involves seeing the organization as a whole, rather than as a collection of individual parts.2. Personal MasteryPersonal mastery is the second discipline that needs to be developed in a learning organization. Personal mastery means being committed to continuously learning, growing, and improving oneself.
3. Mental ModelsThe third discipline is mental models. Mental models are the assumptions and beliefs that we hold about the world, and they can be either limiting or empowering. To become a learning organization, individuals must learn how to challenge their mental models and develop new ways of thinking.
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With one hour of labor time nation A can produce either 3X or 3Y while nation B can produce either 1X or 3Y (and labor is the only input). The range of mutually beneficial trade between nation A and B is: a. 3Y<3X<5Y b. 5Y<3X<9Y c. 3Y<3X<9Y d. 1Y<3X<3Y
Option c represents the range of mutually beneficial trade between nations A and B. 3Y < 3X < 9Y.
To determine the range of mutually beneficial trade, we need to compare the opportunity costs of producing X and Y in each nation. Nation A can produce 3X or 3Y with one hour of labor, while Nation B can produce 1X or 3Y with the same labor input.
In nation A, the opportunity cost of producing 1X is 1Y (3Y/3X), and the opportunity cost of having 1Y is 1/3X (3X/3Y).
In nation B, the opportunity cost of producing 1X is 3Y (3Y/1X), and that of producing 1Y is 1/3X (1X/3Y).
For mutually beneficial trade to occur, the opportunity cost ratios must differ between the two nations. From the given options, option c. 3Y < 3X < 9Y satisfies this condition. This means that nation B has a comparative advantage in producing X. In contrast, nation A has a comparative advantage in producing Y. By specializing in their respective areas of comparative advantage and trading, both nations can benefit and increase their overall output.
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Which of the following is not a characteristic of a successful entrepreneur? Tends to be doggedly optimistic (perhaps even to a fault) Sees and seizes a commercial opportunity Retains all revenues Obtains the physical, financial, and human resources needed for the venture to succeed
The characteristic that is not of a successful entrepreneur is that they retain all revenues.
An entrepreneur is an individual who creates, manages, and assumes the risk of a business or organization, whether it is a start-up or a well-established business. Entrepreneurs usually have several common characteristics that are essential for their success. Tends to be doggedly optimistic (perhaps even to a fault)An entrepreneur is always hopeful of succeeding despite the challenges that may come up.
Optimism is an essential characteristic for entrepreneurs as it helps them to persevere through challenging times.Sees and seizes a commercial opportunity. Entrepreneurs are always on the lookout for opportunities to start or grow their business. They have a keen eye for recognizing a good opportunity and taking advantage of it. Obtains the physical, financial, and human resources needed for the venture to succeed.
Retains all revenues. This is not a characteristic of a successful entrepreneur. Entrepreneurs understand that they need to invest their profits back into the business to sustain and grow it. They reinvest their profits into the business, so they are not concerned with retaining all the revenues. Hence, the correct option is the third one that they Retain all revenues.
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gamis n. Suppose Bon Temps is expected to experience zero growth during the first 3 years and then resume its steadystate growth of 4% in the fourth year. What would be its value then? What would be its expected dividend and capital gains yields in Year 1? In Year 4? Q.16 PREFERRED STOCK VALUATION Earley Corporation issued perpetual preferred stock with an 8% annual dividend. The stock currently yields 7%, and its par value is $100. a. What is the stock's value? b. Suppose interest rates rise and pull the preferred stock's yield up to 9%. What is its new market value?
he value of Bon Temps after the fourth year, assuming zero growth during the first 3 years The capital gains yield would also be zero because there is no expected increase in the stock's price. The capital gains yield would be the expected increase in the stock price divided by the current stock price.
Bon Temps' value after the third year of zero growth and resuming its steady-state growth of 4% in the fourth year would be based on the future dividends and the required rate of return. The value can be determined using the dividend discount model (DDM) or the Gordon growth model. Without additional information, it is not possible to calculate the exact value.
In Year 1, since Bon Temps is expected to experience zero growth, its expected dividend yield would be zero.
In Year 4, when Bon Temps resumes its steady-state growth of 4%, the expected dividend yield would be the dividend per share divided by the stock price.
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6² implies π = π* + 3. Consider the delegation problem under discretionary policy. Suppose social loss minimization (y* —yflex) + (x² − *), while loss minimization for a "hawkish" central banker with a' > a implies π = π* + ²+² (y* - flex) + a² + ²(x² − n*). Let n*, Q and EQ be equilibrium inflation under rule-based policy with commitment, discretionary policy without delegation, and discretionary policy with delegation, respectively. (a) Show, mathematically, that *
Given the loss minimization for social loss and loss minimization for a "hawkish" central banker with a' > a are(y* —yflex) + (x² − n*)π = π* + ²+² (y* - flex) + a² + ²(x² − n*).
We need to show mathematically that delegation under discretionary policy can improve welfare.
The equilibrium inflation under rule-based policy with commitment, discretionary policy without delegation, and discretionary policy with delegation are n*, Q and EQ respectively.
The delegation problem under discretionary policy isEQ=min {(y* − yflex) + a²+²(x² − Q)} {π = π* + a²+²(y* − yflex) + a² + ²(x² − Q)}From the FOC of this problem, we geta²+²(Q− x²) = a²+²(Q − n*)
From this, we getQ =n*which implies that the delegation under discretionary policy can improve welfare. Thus, it is true that under delegation, social welfare is improved.
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businessfinancefinance questions and answersyou cwit a bulding that is expected to pay annual cash flows forever. what is the value of the buidirig if the cost of capital is 8.5% and annual cash flows are experted to grow by 23% per year forever with the first one expected to be se00000 in 1 year? round the yalue to 0th decirnis to get a whole namber) question 2 you cwn a building that is expected to
Question: You Cwit A Bulding That Is Expected To Pay Annual Cash Flows Forever. What Is The Value Of The Buidirig If The Cost Of Capital Is 8.5% And Annual Cash Flows Are Experted To Grow By 23% Per Year Forever With The First One Expected To Be Se00000 In 1 Year? Round The Yalue To 0th Decirnis To Get A Whole Namber) QUESTION 2 You Cwn A Building That Is Expected To
You cwit a bulding that is expected to pay annual cash flows forever. What is the value of the buidirig if the cost of capita
You own a building that is expected to pay annual cash flows forever. If the building is worth \( \$ 2600000 \), the cost of
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You cwit a bulding that is expected to pay annual cash flows forever. What is the value of the buidirig if the cost of capital is 8.5% and annual cash flows are experted to grow by 23% per year forever with the first one expected to be se00000 in 1 year? Round the yalue to 0th decirnis to get a whole namber) QUESTION 2 You cwn a building that is expected to pay annual cash flows forever. If the building is worth $840000, the cost of capital is 8.5%, annual cash flows are expected with the first one due in one year and equal to $62000, and all subsequent cash flows are expected to prow annually by a constant rate, hen what is the expected annual growth rate of expected cash flows?Round the value to 100th decimal and Please enter the value only without converting it to a decimal format. If the answer is 8.55%, enter 8.55 ) You own a building that is expected to pay annual cash flows forever. If the building is worth $2600000, the cost of capital is 5.0%, and annual cash flows are expected with the first one due in one year and all subsequent ones growing annually by 2.2%, then what is the arnount of the cash flow produced by the building in 3 years expected to be?Round the value to oth decimal to get a whole number) QUESTION 4 You cWn a bullding that is expected to pay annual cash flows forever. If the building is worth 52500000 , the cost of capital is 4 his, and annual cash flown are expected with the first one due in one year and all subsequent ones growing annually by 2.16, then what is the amount of the cash fiow produced by the building in 1 year expected to beriound the value to oth decimal to get a whole number)
As per Chegg Policy, we will only answer the first question of the set of questions given.
Value of the building that is expected to pay annual cash flows forever is given by the following formula:
PV=CF1/(k-g)
Where, PV = Present Value
CF1 = Cash flow in the first year k = Cost of capital g = Growth rate of annual cash flows Let's put the given values in the above formula and calculate the PV:
CF1 = $90,000k = 8.5%g = 23%PV=CF1/(k-g)PV=$600,000
Hence, the value of the building that is expected to pay annual cash flows forever is $600,000.
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A toy manufacturer uses 42,840 rubber wheels per year for its popular dump truck series. The firm makes its own wheeis, which it can produce at a rate of 800 per day. The toy trucks are assembled uniformly over the entire year. Carfying cost is $1.60 per wheel per year. Setup cost for a production run is $50. The firm operates 238 days per yeat. Determine the following: a. Optimal run size (Round your answer to a whole number, following normal rules of rounding.) b. Use your final answer from part a to determine minimum total annual cost for carrying and setup. (Round your answer to a whole number.) c. Cycle time for the optimal run size (Round your answer to two decimal points.) c. Cycle time for the optimal run size (Round your answer to two decimal points.) d. Run time (Round your answer to two decimal points.)
To determine the optimal run size and minimum total annual cost for carrying and setup, we can use the Economic Order Quantity (EOQ) formula.
Given:
Annual demand (D) = 42,840 rubber wheels
Production rate (R) = 800 wheels per day
Carrying cost per wheel per year (C) = $1.60
Setup cost (S) = $50
Operating days per year (N) = 238
a. Optimal run size (EOQ):
EOQ = √((2DS) / C)
EOQ = √((2 * 42,840 * 50) / 1.60)
EOQ ≈ √(2,284,000 / 1.60)
EOQ ≈ √1,427,500
EOQ ≈ 1,194 (rounded to the nearest whole number)
Therefore, the optimal run size is 1,194 rubber wheels.
b. Minimum total annual cost for carrying and setup:
Total annual cost (TC) = (√((2DS) / C)) * C + ((D / √((2DS) / C)) * S)
TC = (1,194 * 1.60) + ((42,840 / 1,194) * 50)
TC ≈ 1,910.40 + 1,429.69
TC ≈ 3,340.09
Therefore, the minimum total annual cost for carrying and setup is $3,340 (rounded to the nearest whole number).
c. Cycle time for the optimal run size:
Cycle time = (EOQ / R) * N
Cycle time = (1,194 / 800) * 238
Cycle time ≈ 1.49
Therefore, the cycle time for the optimal run size is approximately 1.49 days.
d. Run time:
Run time = EOQ / R
Run time = 1,194 / 800
Run time ≈ 1.49
Therefore, the run time for the optimal run size is approximately 1.49 days.
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What is the NOC code for the job title of Accounting Clerk? (1
mark)
The National Occupational Classification (NOC) is a system used in Canada to classify occupations. The NOC code for the job title of Accounting Clerk is 1431.
The National Occupational Classification (NOC) is a system used in Canada to classify and categorize occupations. Each occupation is assigned a unique four-digit code that represents the nature of the work and the skills required for that particular job.
In the case of an Accounting Clerk, the NOC code is 1431. This code falls under the category of "Accounting and Related Clerks" and includes positions that involve various accounting and bookkeeping tasks such as maintaining financial records, processing invoices, reconciling accounts, preparing financial statements, and assisting with financial reporting.
The NOC code 1431 helps in standardizing job classifications and provides a consistent way to identify and categorize occupations within the accounting field in Canada.
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Bei FDIC data for the state of ows The latest the top 4 commercial banksted on market share in 1994 and 2014 these data, select the correct statement 1994 FDIC Summary of Deposits Bank nstitution Name NationsBank Hawkeye Bank Cycline Bank Quad Cities Bank 2019 FDIC Summary of Deposits Branch Banking and Trust Company First Citizens Bank & Trust Bank (Institution) Name Wells Fargo Bank, National Association JP Morgan, National Association IA State MA IA LA IA IA IA State Bank Class Branches Deposit Market Share N A N N N N N 191 NM 150 71 Bank Class Branches Deposit Market Share 247 158 21.45% 82 9.87% 741% 18.37% 15.07% 8,41% 2019 FDIC Summary of Depouts Bank Onstitution) Name Wells Fargo Bank, National Association JP Morg, National Association Branch Banking and Trust Company First-Citizens Bank & Trust Company State Bank Class Branches Deposit Market Share Previous IA IA IA IA N iz N NM NM 247 150 02 53 18.37% 15.07 8.41% 4.40% The banking industry in fowa has become less concentrated, which is the same as that of the US as a whole O The banking industry in lowa has become more concentrated, which is the same as that of the US in a whole The banking industry in lowa has become more concentrated, which is opposite that of the US as a whole The banking industry in lowa has become less concentrated, which is opposite that of the US as a whole. Nod
Based on the provided data, the correct statement is:
The banking industry in Iowa has become less concentrated, which is the same as that of the US as a whole.
In 1994, the top 4 commercial banks in Iowa had a higher deposit market share compared to 2019. This indicates a decrease in concentration within the banking industry in Iowa. The statement further mentions that this trend is similar to the overall banking industry in the US.Certainly! In order to analyze the concentration of the banking industry in Iowa, we can compare the deposit market share of the top 4 commercial banks in 1994 and 2019. In 1994, the data shows that the top 4 commercial banks had a higher deposit market share, indicating a more concentrated industry. However, in 2019, the deposit market share of these banks decreased, suggesting a less concentrated industry. The statement mentions that this change in concentration aligns with the trend observed in the overall banking industry in the United States. If the overall banking industry in the US has also experienced a decrease in concentration during the same period, it implies that the banking industry in Iowa is following a similar pattern. Overall, the explanation highlights that the banking industry in Iowa has become less concentrated over time, which is in line with the broader trend observed in the US banking industry.
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Describe the set of criteria that may be imcluded for
the supplier evaluation as precribed by Badenhorst - weiss et
al
Badenhorst-Weiss et al. (2016) proposed a set of criteria for supplier evaluation, which can be considered when assessing and selecting suppliers. These criteria aim to ensure that suppliers meet specific requirements and can effectively contribute to the buyer's supply chain. Here are some criteria that may be included in the supplier evaluation process based on their framework:
Price/Cost: Assessing the competitiveness of the supplier's pricing and cost structure compared to other potential suppliers. Quality: Evaluating the supplier's ability to consistently deliver products or services that meet or exceed specified quality standards. Delivery Performance: Assessing the supplier's track record in terms of on-time delivery, lead time, and order fulfillment. Reliability: Evaluating the supplier's dependability and consistency in meeting commitments and resolving issues promptly. Financial Stability: Assessing the supplier's financial health and stability to ensure their ability to fulfill long-term commitments and investments. Flexibility: Evaluating the supplier's ability to adapt and respond to changes in demand, product specifications, or market conditions. Technical Capability: Assessing the supplier's technical expertise and ability to provide innovative solutions or value-added services. Responsiveness: Evaluating the supplier's promptness and effectiveness in responding to inquiries, requests, and complaints. Ethical and Sustainability Practices: Assessing the supplier's adherence to ethical and sustainable business practices, including environmental responsibility and social compliance.
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A machine has a first cost of $100,000, an annual operation and maintenance cost of $4000, a life of 8 years, and a salvage value of $20,000. At the end of Year 4, it requires a major service, which costs $10,000. If the annual interest rate is 8%, what is the equivalent uniform annual cost of owning and operating this particular machine?
The equivalent uniform annual cost of owning and operating a machine can be calculated using the capitalized cost method. It can be calculated as follows:.
Step 1:
Calculate the total capitalized cost.
Capitalized Cost = Initial Cost + Annual Maintenance and Operating Cost * PVAF + Major Service Cost * PVF,
n=4+ Salvage Value * PVF,
n=4PVAF is the Present Value Annuity Factor and PVF is the Present Value Factor.
Initial Cost = $100,000
Annual Maintenance and Operating Cost = $4,000
Life = 8 years
Salvage Value = $20,000
Major Service Cost = $10,000
Annual Interest Rate = 8%
PVAF = 3.3121 (Using Present Value Annuity Table)PVF,
n=4 = 0.7350 (Using Present Value Table)
Total Capitalized Cost = 100,000 + 4,000 * 3.3121 + 10,000 * 0.7350 + 20,000 * 0.7350
= $133,366
Step 2:
Calculate the Equivalent Uniform Annual Cost (EUAC).
EUAC = Total Capitalized Cost / Annuity Factor
EUAC = $133,366 / 4.5696 (Using Annuity Table)
EUAC = $29,177 (rounded off to the nearest dollar).
Therefore, the equivalent uniform annual cost of owning and operating this particular machine is $29,177.
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(2 Par)
Discuss the importance of self-awareness on multicultural
intelligence
Discuss how a self-awareness assessment could benefit the
marketing management team
Self-awareness is a crucial component of multicultural intelligence, which refers to the ability to understand and navigate diverse cultural contexts effectively. Without self-awareness, individuals may struggle to recognize their own biases, assumptions, and limitations when interacting with people from different backgrounds.
This can lead to misunderstandings, miscommunication, and even discrimination.
By developing self-awareness, individuals can better understand their own cultural background and how it shapes their beliefs, attitudes, and behaviors. They can also become more aware of other cultures and begin to appreciate and respect their differences. This leads to greater empathy, open-mindedness, and inclusivity, all of which are essential for building positive relationships and working effectively in multicultural environments.
A self-awareness assessment can be particularly beneficial for marketing management teams, who often need to work with diverse groups of customers, stakeholders, and partners. By taking an assessment, team members can gain insight into their own cultural biases and preferences, as well as their strengths and weaknesses when working with people from different backgrounds. This information can help them tailor their communication and marketing strategies to be more inclusive and effective, leading to better business outcomes and customer satisfaction. Additionally, a self-awareness assessment can help teams identify areas where they may benefit from additional training or support to improve their multicultural intelligence.
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Which of the following best describes a sales-oriented business? a. The company invests the majority of its resources in promoting its products and services. b. The company is in business to satisfy customers' wants and needs and deliver superior value. c. The company develops its products to meet the needs of specific groups of people. d. The company's primary goal is profit through customer satisfaction.
A sales-oriented business primarily focuses on investing its resources in promoting its products and services to generate sales and profits.
A sales-oriented business is a company that prioritizes the promotion and selling of its products and services as its core strategy for achieving success. In this approach, the company dedicates a significant portion of its resources, such as time, money, and effort, towards marketing and advertising activities. The goal is to create awareness, generate leads, and ultimately convert them into sales.
To effectively promote their offerings, sales-oriented businesses employ various tactics, including advertising campaigns, sales promotions, and training programs for their sales force. They invest in market research to identify potential customer segments and develop targeted marketing strategies to reach them.
The primary objective of a sales-oriented business is to drive profits by maximizing sales revenue. While customer satisfaction is important, it is not the central focus. Instead, the company's success is primarily measured by its ability to generate sales and achieve financial goals.
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The risk-free rate is 7%, and the expected return on the market is 10%. According to the CAPM, what is the beta on a stock with an expected return of 9%?
a.0.945
b.1.144
c.none of the choices
d.0.667
The beta on a stock with an expected return of 9% would be b. 1.144. According to the Capital Asset Pricing Model (CAPM), the expected return of a stock is determined by the risk-free rate, the market risk premium, and the stock's beta. The formula for CAPM is:
Expected Return = Risk-Free Rate + Beta * Market Risk Premium
Given that the risk-free rate is 7% and the expected return on the market is 10%, we can calculate the market risk premium as 10% - 7% = 3%. To find the beta, we rearrange the formula:
Beta = (Expected Return - Risk-Free Rate) / Market Risk Premium
Plugging in the values, we get (9% - 7%) / 3% ≈ 0.667. Therefore, the correct answer is d. 0.667.
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Suppose that the price of croissants rises from $2 to $3 per unit. Use the mid-point pproach to get the elasticity. a. The quantity of orange juice purchased falls from 10 million bottles to 5 million bottles. What is the cross-price elasticity of demand between croissants and orange juice? Are they complements or substitutes? b. The quantity of jelly purchased increases from 10 million jars to 20 million jars. What is What is the cross-price elasticity of demand between croissants and jelly? Are they complements or substitutes?
The cross-price elasticity of demand between croissants and orange juice is -3, suggesting they are complements. For croissants and jelly, the cross-price elasticity is 3, indicating they are substitutes.
The cross-price elasticity of demand is calculated as the percentage change in quantity demanded of one good divided by the percentage change in the price of another good. For croissants and orange juice, the change in quantity demanded is -50% ((5-10)/((5+10)/2)) and the change in price of croissants is 33.33% ((3-2)/((3+2)/2)), giving an elasticity of -3. This negative value indicates they are complements. For croissants and jelly, the change in quantity demanded is 66.66% ((20-10)/((20+10)/2)) and the change in the price of croissants is 33.33%, giving an elasticity of 3. This positive value indicates they are substitutes.
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Jonathan has $1 million in savings and owns a house. With a 0.1% probability(yes, it is 0.1% and not 0.1), the house burns down and costs $800,000 to rebuild. He can buy insurance at a cost of $1.20 per $1,000 of coverage (for example, if he pays $12 in insurance, he is repaid $10,000 if the house burns down). Jonathan’s preferences over realized wealth are given by () = √ . (Hint: this implies that Jonathan’s marginal utility is given by: U() = / ^(−/))
What is Jonathan’s expected utility, certainty equivalent, and optimal amount of insurance to purchase?
Jonathan's expected utility, certainty equivalent, and optimal amount of insurance to purchase based on his preferences and the given probabilities and costs.
Expected Utility:
The expected utility is calculated by weighing the utility of each outcome by its respective probability. In this case, we have two scenarios: the house burns down (0.1% probability) or it does not (99.9% probability).
Expected Utility = (0.001 * √(1,000,000 - 800,000)) + (0.999 * √1,000,000)
Certainty Equivalent:
The certainty equivalent is the amount of certain wealth that would make Jonathan equally satisfied as taking the gamble with uncertain outcomes. It represents the guaranteed amount of money he would be willing to accept instead of taking the risk.
To find the certainty equivalent, we equate the utility of the expected wealth with the utility of the certain wealth:
√(1,000,000 - C.E.) = Expected Utility
Solving for the Certainty Equivalent (C.E.), we can find the amount of certain wealth Jonathan is willing to accept.
Optimal Amount of Insurance:
The optimal amount of insurance is the amount that maximizes Jonathan's expected utility. It balances the cost of insurance premiums with the potential loss from the house burning down.
To calculate this, we need to compare the expected utility with and without insurance for different coverage amounts. We can find the coverage amount that maximizes utility while considering the cost of insurance.
Note: The actual calculations involving the square root function and optimization process go beyond the word limit. It would be best to use a spreadsheet or a mathematical software program to perform the necessary calculations accurately.
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Conklin Services prepares financial statements only once per year using an annual accounting period ending on December 31. Each of the following statements describes an entry made by Conklin on December 31 of a recent year. On December 31, Conklin completed a service agreement for Pizza Planet and recorded the related revenue. The job started in August. Conklin provides weekly service visits to the local C.J. Nickel department store to check and maintain various pieces of computer printing equipment. On December 31, Conklin recorded revenue for the visits completed during December. The cash will not be received until January. Conklin’s salaried employees are paid on the last day of every month. On December 31, Conklin recorded the payment of December salaries. Conklin’s hourly wage employees are paid every Friday. On December 31, Conklin recorded as payable the wages for the first three working days of the week in which the year ended. On December 31, Conklin recorded the receipt of a shipment of office supplies from Office Supplies Inc. to be paid for in January. On December 31, Conklin recorded the estimated use of supplies for the year. The supplies were purchased for cash earlier in the year. Early in December, Conklin was paid in advance by Parker Enterprises for 2 months of weekly service visits. Conklin recorded the advance payment as a liability. On December 31, Conklin recorded revenue for the service visits to Parker Enterprises that were completed during December. On December 31, Conklin recorded depreciation expense on office equipment for the year. Required: Indicate whether each entry is an adjusting entry or a regular journal entry, and, if it is an adjusting entry, identify it as one of the following types: (1) revenue recognized before collection of cash, (2) expense recognized before payment of cash, (3) revenue recognized after collection of cash, or (4) expense recognized after payment of cash. The answer to this is already on chegg, but could someone please explain how to get to the solution?
To determine whether each entry is an adjusting entry or a regular journal entry and to identify the type of adjusting entry, we need to analyze the nature of the transaction and its impact on the financial statements. Here is the breakdown of each entry:
Recording the completion of a service agreement for Pizza Planet and the related revenue (Adjusting entry - Revenue recognized before collection of cash): This is an adjusting entry because revenue is recognized before the cash is collected. It falls under the category of revenue recognized before collection of cash. Recording revenue for service visits to C.J. Nickel completed in December (Regular journal entry - Revenue recognized after collection of cash): This is a regular journal entry as revenue is recognized after the cash is collected. It falls under the category of revenue recognized after collection of cash. Recording the payment of December salaries for salaried employees (Regular journal entry): This is a regular journal entry as it represents the payment of an expense (salaries) after the cash is paid.Recording wages payable for the first three working days of the week ended December 31 (Adjusting entry - Expense recognized before payment of cash): This is an adjusting entry as it recognizes the expense (wages) before the cash is paid. It falls under the category of expense recognized before payment of cash.
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Prove and argue how planning makes a business more effective.
(business planning)
Making a firm more effective requires careful preparation. Here are some justifications for this assertion: Alignment of Goals: Planning enables organisations to establish precise goals and objectives.
It offers a road map outlining the goals to be achieved and the actions required to get there. Planning makes sure that efforts are concentrated and coordinated, maximising efficiency and effectiveness by matching resources and activities with these aims. Resource Optimisation: Smart resource allocation and analysis go hand in hand. This encompasses material, human, and financial resources. Businesses may prevent waste, give priority to important tasks, and maximise production by properly planning resource allocation, which will increase efficiency and effectiveness.Risk Mitigation: Planning enables companies to recognise possible hazards and create mitigation plans. It entails studying the market.
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