Calculate the required rate of return for Manning Enterprises (A+)

Calculate the required rate of return for Manning Enterprises, assuming that investors expect a 4.5% rate of inflation in the future. The real risk-free rate is 1.00% and the market risk premium is 6.0%. Manning has a beta of 1.5, and its realized rate of return has averaged 11.0% over the last 5 years.

Click here for the SOLUTION

Posted in Homework Help | Comments Off

Stock X has a 10.0% expected return, a beta coefficient of 0.9, and a 40% standard deviation of expected returns (A+)

Stock X has a 10.0% expected return, a beta coefficient of 0.9, and a 40% standard deviation of expected returns. Stock Y has a 13.0% expected return, a beta coefficient of 1.3, and a 25.0% standard deviation. The risk-free rate is 6%, and the market risk premium is 5%.

Calculate each stock’s coefficient of variation. Round your answers to two decimal places.

Requirements:

a. CVx =

b. CVy =

c. Which stock is riskier for a diversified investor?

I. For diversified investors the relevant risk is measured by beta. Therefore, the stock with the higher beta is less risky. Stock Y has the higher beta so it is less risky than Stock X.

II. For diversified investors the relevant risk is measured by beta. Therefore, the stock with the higher beta is more risky. Stock Y has the higher beta so it is more risky than Stock X.

III. For diversified investors the relevant risk is measured by standard deviation of expected returns. Therefore, the stock with the higher standard deviation of expected returns is more risky. Stock X has the higher standard deviation so it is more risky than Stock Y.

IV. For diversified investors the relevant risk is measured by beta. Therefore, the stock with the lower beta is more risky. Stock X has the lower beta so it is more risky than Stock Y.

V. For diversified investors the relevant risk is measured by standard deviation of expected returns. Therefore, the stock with the lower standard deviation of expected returns is more risky. Stock Y has the lower standard deviation so it is more risky than Stock X.

Calculate each stock’s required rate of return.

d. rx =

e. ry =

f. On the basis of the two stocks’ expected and required returns, which stock would be more attractive to a diversified investor?

Calculate the required return of a portfolio that has $3,000 invested in Stock X and $9,500 invested in Stock Y. Round your answer to two decimal places.

g. rp =

Click here for the SOLUTION

Posted in Homework Help | Comments Off

MATH 270 Week 2 Lab Worksheet (A+ Guaranteed)

Part 1: Rules for integrating trigonometric functions

There are three rules governing how we deal with integrals of this form.

If the power of the sine is odd and positive, save one sine factor and
convert the remaining factors to cosine. Then, expand and integrate.

If the power of cosine is odd and positive, save one cosine factor and
convert the rest to sine. Then, expand and integrate.

If the powers of both the sine and cosine are even and nonnegative, make repeated use of the identities

1. Integrate ∫▒〖〖cos〗^3 (x) 〖sin〗^3 (x)dx〗 . Which of the rules above will you choose? Why?

2. Choose a rule and rewrite the above integral using it. Be sure to put the factor you are saving to the immediate left of the dx. Please underline the saved factor.

3. Convert the non-underlined terms in the result of part two into sin or cos depending on the rule you chose to use. What identity can we use to do this?

4. What relationships between sin and cos are we taking advantage of when we use the rules above? Based on step 2 above what should we set u equal to so that we can make a substitution that allows us to use the general power rule to complete the integration?

u =
du =

5. Substitute u and du into your integral and use the general power rule to integrate.

6. Substitute the trig factor back in for u to write your final answer.

7. Use the trig rules to integrate ∫▒〖〖sin〗^5 (x)dx〗

8. Use the trig rules to integrate ∫▒〖〖cos〗^2 (x) 〖sin〗^2 (x)dx〗

Integrals involving tan(x), sec(x), cot(x), csc(x)

If the power of sec or csc is even and positive, save a sec or csc squared
factor and convert the remaining factors to tangents.

If the power of the tan or cot is odd and positive, save a sectan or csccot
factor and convert the remaining factors to secants.

If there are no secant factors and the power of the tangent is even and
positive convert a tangent squared factor to secants, expand and repeat if
needed.

If the integral is of the form where m is odd and positive, use
integration by parts.

If none of the first four cases apply, try converting to sines and cosines.

1. Integrate ∫▒〖〖sec〗^2 (x) 〖tan〗^3 (x)dx〗 . Which of the rules above will you choose? Why?

2. Choose a rule and rewrite the above integral using it. Be sure to put the factor you are saving to immediate left of the dx. Please underline the saved factor.

3. Convert the non-underlined terms in the result of part two into sec or tan depending on the rule you chose to use. What identity can we use to do this?

4. What relationships between sec and tan are we taking advantage of when we use the rules above? Based on step 2 above what should we set u equal to so that we can make a substitution that allows us to use the general power rule to complete the integration?

u =
du =

5. Substitute u and du into your integral and use the general power rule to integrate. You may have to use the distributive property to eliminate any parentheses first.

6. Substitute the trig factor back in for u to write your final answer.

7. Use the trig rules to integrate ∫▒〖〖sec〗^3 (x)tan(x)dx〗

8. Use the trig rules to integrate ∫▒〖〖tan〗^2 (x)dx〗

Part II: Integration by Parts

Formula: ∫▒〖udv=uv-∫▒vdu〗

1. Integrate ∫▒〖x^2 e^3x dx〗. What should u be? What about dv? Why?

u = dv =

2. Find du and v. Remember that du is the derivative of u and v is the Antiderivative of dv.

du = v =

3. Substitute the values from steps 1 and 2 into the by parts formula. Can we integrate the new integral ∫▒vdu using basic formulas? Why or Why not? If not repeat steps 1 – 3 for the new integral.

∫▒〖x^2 e^3x dx〗 =

4. In the above problem you will need to use integration by parts twice. You will have 3 terms in your final answer. What is your final answer? Hint: Be sure to track through your negative signs.

5. In the above integral you had a finite number of times you had to use integration by parts. In the integral ∫▒〖e^x sin⁡(x)dx〗you could use integration by parts indefinitely. How can we avoid this?

6. ∫▒〖e^(-x) sin⁡(3x)dx〗

7. ∫▒〖x^2 ln⁡(x)dx〗

Part III: Trigonometric Substitution

Trigonometric Substitution Rules

For √(a^2-u^2 ) let u = asin⁡θ and √(a^2-u^2 ) = acos⁡θ
For √(a^2+ u^2 ) let u = atanθ and √(a^2+u^2 ) = asecθ
For √(u^2-a^2 ) let u = asec⁡θ and √(u^2-a^2 ) = atanθ

1. Integrate ∫▒dx/√(25+4x^2 ). Identify the following:

a = u = du =

What adjustment, if any, needs to be made to the integral to complete the substitution in to u?

2. Rewrite the above integral so that it is all in u.

3. Which of the trig substitution rules above will we use to solve this integral? Why? Draw and label the relevant right triangle diagram. See the week 2 lecture or Section 28.8, page 858-9 for ideas on how to do this.

4. Use the rule you chose and the diagram to identify what you will replace u, du and √(a^2+u^2 ) with.

5. Rewrite the integral from step 2 using the replacements from step 4. Did you use all the replacements? If not, why not? Can this integral be simplified? If so, do it?

6. Integrate the resulting trig function using a basic formula.

7. Use the information from steps 1 and 4 to rewrite the answer in step 6 in terms of the variable x.

u = 2x = 5tanθ and √(a^2+u^2 )=√(25+4x^2 )=5secθ

8. How does knowing the trigonometric relationships as defined by the three sides of a right triangle and the Pythagorean Theorem help us solve integrals using trig substitutions?

Now try these

9. ∫▒dx/(x√(49-9x^2 ))

10. ∫▒dx/√(16x^2-1)

Here’s the SOLUTION

Posted in Homework Help | Comments Off

Consider the following information for three stocks, Stocks X, Y, and Z (A+)

Consider the following information for three stocks, Stocks X, Y, and Z. The returns on the three stocks are positively correlated, but they are not perfectly correlated. (That is, each of the correlation coefficients is between 0 and 1.)

STOCKÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â `EXPECTED RETURNÂ Â Â Â Â Â Â Â STANDARD DEVIATIONÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â BETA

XÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 9.00%Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 15%Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 0.8

YÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 10.75Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 15Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 1.2

ZÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 12.50Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 15Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 1.6

Fund P has half of its funds invested in Stock X and half invested in Stock Y. Fund Q has one-third of its funds invested in each of the three stocks. The risk-free rate is 5.5%, and the market is in equilibrium. (That is, required returns equal expected returns.) What is the market risk premium ( rM – rRF )?

Click here for the SOLUTION

Posted in Homework Help | Comments Off

Polaski Company manufactures and sells a single product called a Ret (A+)

Polaski Company manufactures and sells a single product called a Ret. Operating at capacity, the company can produce and sell 43,000 Rets per year. Costs associated with this level of production and sales are given below:

Unit Total

Direct materials $14 $602,000

Direct labor 7 301,000

Variable manufacturing overhead 1 43,000

Fixed manufacturing overhead 8 344,000

Variable selling expense 1 43,000

Fixed selling expense 3 129,000

Total cost $34 $1,462,000

The Rets normally sell for $66 each. Fixed manufacturing overhead is constant at $344,000 per year within the range of 16,000 through 43,000 Rets per year.

Requirement 1:

Assume that due to a recession, Polaski Company expects to sell only 16,000 Rets through regular channels next year. A large retail chain has offered to purchase 4,100 Rets if Polaski is willing to accept a 14% discount off the regular price. There would be no sales commissions on this order; thus, variable selling expenses would be slashed by 71%. However, Polaski Company would have to purchase a special machine to engrave the retail chain’s name on the 4,100 units. This machine would cost $4,100. Polaski Company has no assurance that the retail chain will purchase additional units in the future. Calculate the net increase/decrease in profits next year if this special order is accepted.

Requirement 2:

Assume again that Polaski Company expects to sell only 16,000 Rets through regular channels next year. The U.S. Army would like to make a one-time-only purchase of 4,100 Rets. The Army would pay a fixed fee of $1.76 per Ret, and it would reimburse Polaski Company for all costs of production (variable and fixed) associated with the units. Because the army would pick up the Rets with its own trucks, there would be no variable selling expenses associated with this order. If Polaski Company accepts the order, by how much will profits increase or decrease for the year?

Requirement 3:

Assume the same situation as that described in Requirement (2) above, except that the company expects to sell 43,000 Rets through regular channels next year. Thus, accepting the U.S. Army’s order would require giving up regular sales of 4,100 Rets. If the Army’s order is accepted, by how much will profits increase or decrease from what they would be if the 4,100 Rets were sold through regular channels?

Click here for the SOLUTION

Posted in Homework Help | Comments Off

Diversity in the U.S. population plays an increasing role in targeting markets (A+)

Diversity in the U.S. population plays an increasing role in targeting markets.

1. True

2. False

12. Time-based competition is based on a strategy of developing and distributing goods and services more slowly and cautiously than competitors.

1. True

2. False

13. Demarketing is a reaction to a surplus of production materials that results in product supply exceeding demand.

1. True

2. False

14. The U.S. military has historically been a source of product innovation where technology is adapted for the consumer markets.

1. True

2. False

15. Marketing strategies that work for a particular cultural group in the United States will always work when applied to the same cultural group abroad.

1. True

2. False

16. According to recent studies, about 70 percent of US population has Internet access from home, school, or work.

1. True

2. False

17. E-business is comprised of five categories of data interactions: business data exchange, customer shopping, business transactions, market and product research, and multimedia communications.

1. True

2. False

18. North Carolina established a Web site where governmental departments can purchase goods and services through participating suppliers. With the efficiency of online ordering, the departments are experiencing significant savings. The term for this type of virtual marketplace is e-procurement.

1. True

2. False

19. Business to customer marketing, called B2C, is also known as e-marketing.

1. True

2. False

20. In planning a successful Web site, an organization must first determine what it wishes to accomplish, followed by a plan outlining the scope of the project, and the resources needed behind the scenes to allow the site to deliver on its promises.

1. True

2. False

Click here for the SOLUTION

Posted in Homework Help | Comments Off

The existence of the WTO, the passage of NAFTA, (A+)

The existence of the WTO, the passage of NAFTA, and the creation of the Euro are examples of protectionism on the part of nations concerned with increased globalization of the marketplace.

1. True

2. False

2. A focus on maintaining and satisfying existing customers is consistent with the relationship era.

1. True

2. False

3. Interactive multimedia technologies have revolutionized the way people store, distribute, retrieve, and present information.

1. True

2. False

4. Compared with traditional media, the hypermedia resources of the Web suffer from a number of disadvantages, particularly with regard to speed of access and facility of navigation.

1. True

2. False

5. Mobile marketing is a term used to describe marketing messages sent via wireless technology.

1. True

2. False

6. According to relationship marketing, companies view their suppliers as adversaries against whom they must fiercely negotiate prices, playing one off against the other so that they can offer their customers the best and cheapest.

1. True

2. False

7. When Starbucks makes a latte for a customer, it is performing a distribution function.

1. True

2. False

8. Strategies are static and, once implemented, should not be changed if the actual performance does not meet the desired results.

1. True

2. False

9. An important strategic planning tool, SWOT analysis helps planners compare internal organizational strengths and weaknesses with external opportunities and threats.

1. True

2. False

10. A customer-driven organization begins its marketing strategy with a detailed description of its target market.

1. True

2. False

Click here for the SOLUTION

Posted in Homework Help | Comments Off

Assets, liabilities, and equity accounts are not closed; these accounts are called (A+)

Assets, liabilities, and equity accounts are not closed; these accounts are called:

a) Nominal accounts

b) Temporary accounts

c) Permanent accounts

d) Contra accounts

e) Accrued accounts

22. The closing process is necessary in order to:

a) calculate net income or net loss for an accounting period

b) ensure that all permanent accounts are closed to zero at the end of each accounting period

c) ensure that the company complies with state laws

d) ensure that net income or net loss and owner withdrawals for the period are closed into the owner’s capital account

e) ensure that management is aware of how well the company is operating

23. The assets section of a classified balance sheet usually includes:

a) Current assets, long-term investments, plant assets, and intangible assets

b) Current assets, long-term assets, revenues, and intangible assets

c) Current assets, long-term investments, plant assets, and equity

d) Current liabilities, long-term investments, plant assets, and intangible assets

e) Current assets, liabilities, plant assets, and intangible assets

24. Two common subgroups for liabilities on a classified balance sheet are:

a) current liabilities and intangible liabilities

b) present liabilities and operating liabilities

c) general liabilities and specific liabilities

d) intangible liabilities and long-term liabilities

e) current liabilities and long-term liabilities

25. The current ratio:

a) Is used to measure a company’s profitability

b) Is used to measure the relation between assets and long-term debt

c) Measures the effect of operating income on profit

d) Is used to help evaluate a company’s ability to pay its debts in the near future

e) Is calculated by dividing current assets by equity

Click here for the SOLUTION

Posted in Homework Help | Comments Off

Profit margin is defined as (A+)

Profit margin is defined as:

a) Revenues divided by net sales

b) Net sales divided by assets

c) Net income divided by net sales

d) Net income divided by assets

e) Net sales divided by net income

12. An account linked with another account that has an opposite normal balance and that is subtracted from the balance of the related account is a(n):

a) Accrued expense

b) Contra account

c) Accrued revenue

d) Intangible asset

e) Adjunct account

13. The total amount of depreciation recorded against an asset or group of assets during the entire time the asset or assets have been owned:

a) Is referred to as depreciation expense

b) Is referred to as accumulated depreciation

c) Is shown on the income statement of the final period

d) Is only recorded when the asset is disposed of

e) Is referred to as an accrued asset

14. Prior to recording adjusting entries, the Office Supplies account had a $359 debit balance. A physical count of the supplies showed $105 of unused supplies available. The required adjusting entry is:

a) Debit Office Supplies $105 and credit Office Supplies Expense $105

b) Debit Office Supplies Expense $105 and credit Office Supplies $105

c) Debit Office Supplies Expense $254 and credit Office Supplies $254

d) Debit Office Supplies $254 and credit Office Supplies Expense $254

e) Debit Office Supplies $105 and credit Supplies Expense $254

15. If throughout an accounting period the fees for legal services paid in advance by clients are recorded in an account called Unearned Legal Fees, the end-of-period adjusting entry to record the portion of those fees that has been earned is:

a) Debit Cash and credit Legal Fees Earned

b) Debit Cash and credit Unearned Legal Fees

c) Debit Unearned Legal Fees and credit Legal Fees Earned

d) Debit Legal Fees Earned and credit Unearned Legal Fees

e) Debit Unearned Legal Fees and credit Accounts Receivable

16. On April 1, a company paid the $1,350 premium on a three-year insurance policy with benefits beginning on that date. What will be the insurance expense on the annual income statement for the year ended December 31?

a) $1,350.00

b) $450.00

c) $1,012.50

d) $337.50

e) $37.50

17. Unearned revenue is reported in the financial statements as:

a) A revenue on the balance sheet

b) A liability on the balance sheet

c) An unearned revenue on the income statement

d) An asset on the balance sheet

e) An operating activity on the statement of cash flows

18. Which of the following assets is not depreciated?

a) Store fixtures

b) Computers

c) Land

d) Buildings

e) All of these are depreciated

19. Which of the following does not require an adjusting entry at year-end?

a) Accrued interest on notes payable

b) Supplies used during the period

c) Cash invested by owner

d) Accrued wages

e) Expired portion of prepaid insurance

20. Revenues, expenses, and withdrawals accounts, which are closed at the end of each accounting period are:

a) Real accounts

b) Temporary accounts

c) Closing accounts

d) Permanent accounts

e) Balance sheet accounts

Click here for the SOLUTION

Posted in Homework Help | Comments Off

The accounting principle that requires revenue to be recorded when earned is the (A+)

The accounting principle that requires revenue to be recorded when earned is the:

a) Matching principle.

b) Revenue recognition principle

c) Time period assumption

d) Accrual reporting principle

e) Going-concern assumption

2. Adjusting entries:

a) Affect only income statement accounts

b) Affect only balance sheet accounts

c) Affect both income statement and balance sheet accounts

d) Affect only cash flow statement accounts

e) Affect only equity accounts

3. The broad principle that requires expenses to be reported in the same period as the revenues that were earned as a result of the expenses is the:

a) Recognition principle

b) Cost principle

c) Cash basis of accounting

d) Matching principle

e) Time period principle

4. The approach to preparing financial statements based on recognizing revenues when they are earned and matching expenses to those revenues is:

a) Cash basis accounting

b) The matching principle

c) The time period assumption

d) Accrual basis accounting

e) Revenue basis accounting

5. Prepaid expenses, depreciation, accrued expenses, unearned revenues, and accrued revenues are all examples of:

a) Items that require contra accounts

b) Items that require adjusting entries

c) Asset and equity

d) Asset accounts

e) Income statement accounts

6. The accrual basis of accounting:

a) Is generally accepted for external reporting because it is more useful than cash basis for most business decisions

b) Is flawed because it gives complete information about cash flows

c) Recognizes revenues when received in cash

d) Recognizes expenses when paid in cash

e) Eliminates the need for adjusting entries at the end of each period

7. Which of the following statements is incorrect?

a) Adjustments to prepaid expenses, depreciation, and unearned revenues involve previously recorded assets and liabilities

b) Accrued expenses and accrued revenues involve assets and liabilities that had not previously been recorded

c) Adjusting entries can be used to record both accrued expenses and accrued revenues

d) Prepaid expenses, depreciation, and unearned revenues often require adjusting entries to record the effects of the passage of time

e) Adjusting entries affect the cash account

8. An adjusting entry could be made for each of the following except:

a) Prepaid expenses

b) Depreciation

c) Owner withdrawals

d) Unearned revenues

e) Accrued revenues

9. A company made no adjusting entry for accrued and unpaid employee wages of $28,000 on December 31. This oversight would:

a) Understate net income by $28,000

b) Overstate net income by $28,000

c) Have no effect on net income

d) Overstate assets by $28,000

e) Understate assets by $28,000

10. If a company mistakenly forgot to record depreciation on office equipment at the end of an accounting period, the financial statements prepared at that time would show:

a) Assets overstated and equity understated

b) Assets and equity both understated

c) Assets overstated, net income understated, and equity overstated

d) Assets, net income, and equity understated

e) Assets, net income, and equity overstated

Click here for the SOLUTION

Posted in Homework Help | Comments Off