A method has been engineered and an operator has been time studied. The method has produced an average overall time of 2.39 minutes by actual watch timing. The overall pace rating applied to the job was 125%. This company, which uses an incentive system, adds extra time into the production rates to cover personal time, fatigue, and unavoidable delays. The total allowance is 15%. Determine the rated time or normal minutes, the total allowed time or standard minutes, the standard hour rate for the job per 100 units, and the pieces per hour. The labor rate per hour is $23.30. What is the standard labor cost per unit?

1. Why do you think the financial system has become more globally integrated over time?  Can you think of any downside to this increased integration?

2. If offered the choice of receiving $1,000 today or $1,000 in one year’s time, which option would you choose, and why?

3. Suppose financial institutions didn’t exist but you urgently needed a loan. Where would you most likely get this loan? Using Core Principles, identify an advantage and a disadvantage this arrangement might have over borrowing from a financial institution. (LO2)

4.   You are the owner of a small sandwich shop. A buyer may offer one of several payment methods: cash, a check drawn on a bank, a credit card, or a debit card. Which of these is the least costly for you? Explain why the others are more expensive.

UPS is being valued. The following assumptions have been made:
BV per share is estimated at $9.62 on 31 December 2007.
EPS will be 22 percent of the beginning BV per share for the next eight years
Cash dividends paid will be 30 percent of EPS
At the end of the eight-year period, the market price per share will be three times
book value per share at that time.
The beta for UPS is 0.60, the risk free rate is 5 percent and the equity risk
premium is 5.50 percent.
The current market price of UPS is $59.38, which indicates a current P/B of 6.2
a) Prepare a table that shows the beginning and ending book values, net income
and cash dividends annually for eight years.
b) Estimate the residual income and the present value of residual income for the
eight years.
c) Estimate the value per share of UPS stock using the residual income model.

Why, if you were a state government employee, would you prefer to participate in a defined benefit or a defined contribution pension plan? Explain the difference between the two types of plans in your answer

You have been pricing an MP3 player in several stores. Three stores have the identical price of $400. Each store charges 12 percent APR, has a 30-day grace period, and sends out bills on the first of the month. On further investigation, you find that store A calculates the finance charge by using the average daily balance method, store B uses the adjusted balance method, and store C uses the previous balance method. Assume you purchased the MP3 player on May 5 and made a $100 payment on June 15.

What will the finance charge for June be if you made your purchase from store A? From store B? From store C? (Do not round intermediate calculations. Round your answers to 2 decimal places

Finance charge

store A =

store B=

store C=

(Determining the outstanding balance of a​ loan) Ten years ago you took out a $ 250,000​, 20​-year mortgage with an annual interest rate of 12 percent and monthly payments of ​$2,752.72. What is the outstanding balance on your current loan if you just make the 120th ​payment?

​ (Present value of a perpetuity​)  What is the present value of a ​$4,500 perpetuity discounted back to the present at 14 ​percent?

The present value of the perpetuity is $(...)

Sam buys 100 shares of Acme stock at $100 per share on January 1, Year 1. At the end of the first year (December 31, Year 1), she buys 100 more shares at $120 per share. At the end of the second year (December 31, Year 2), she buys another 100 shares for $135 per share. The stock pays a dividend of $2.00 per share on December 29th of each year. Acme is trading at $169.80 as of December 31, Year 3. What is the time weighted return for Acme since January 1, Year 1 to today?

a. 21.00%.

b. 21.81%.

c. 23.21%.

d. 25.00%.

Problem 4-31
Non Annual Compounding

It is now January 1. You plan to make a total of 5 deposits of $500 each, one every 6 months, with the first payment being made today. The bank pays a nominal interest rate of 10% but uses semiannual compounding. You plan to leave the money in the bank for 10 years.

1. How much will be in your account after 10 years? Round your answer to the nearest cent.
   $  
   
2. You must make a payment of $1,658.29 in 10 years. To get the money for this payment, you will make 5 equal deposits, beginning today and for the following 4 quarters, in a bank that pays a nominal interest rate of 14% with quarterly compounding. How large must each of the 5 payments be? Round your answer to the nearest cent.
   $  

4.a. Explain the two causes of liquidity risk.

b. What are two ways a depository institution can offset the effects of asset - side liquidity risk such as the drawing down of a loan commitment?

c.What are the four measures of liquidity risk? Explain how each of them could be implemented and utilized and utilized by a depository institution.

Explain the two simple models to measure credit risk concentration in the loan portfolio : migration analysis and concentration limits.

Write a “bad news” memo to a group of employees in response to this scenario: You are the Human Resources Director at Natural Beauty Cosmetics, a manufacturer of multiple cosmetics lines sold across the globe. Your headquarters and manufacturing plant are in Syracuse, New York, and all told, the company employs 250 people. Many of your employees have degrees in chemistry and other product development fields. Over the past five years, your sales have declined by 6%, as your market has become more dominated by more inexpensive products from overseas. At best, your company projects sales to be flat over the next few years. Additionally, your company’s payments to provide health care for your employees have gone up by 18% since 2013. Until now, Natural Beauty Cosmetics has covered the entire cost of health care, but now your company has been forced to ask employees to pay 25% of their premiums. To explain these changes, your Assistant Director of HR, Marylou Masters will hold a meeting with affected employees at 4 p.m. on Wednesday, November 4 in Room 223 to discuss the new plan, answer any questions, and explain in detail which cost-cutting options, such as choosing a less expensive plan with higher deductibles, will be available. Asking employees to pay for their health care will have a number of benefits. It will help the company remain viable for the foreseeable future, and it will allow the company to keep everyone employed at the Syracuse headquarters. Everyone will still be able to keep his or her current level of medical coverage, and co-pays for any treatment will stay the same. Because this is a difficult decision, and you know that your most-talented employees may be tempted to look for work elsewhere, you are convinced that a face-to-face meeting will ensure that your employees choose the best option for themselves and their families. To make sure that everyone is aware of the meeting, your company will send this memo internally to all of the employees, informing them of the increase in premium payments as well as the meeting.