68. Define the Implied Warranty of Merchantability. Under what circumstances does a merchant make such a warranty? May the warranty be disclaimed?

69. Who is classified as a merchant under the UCC?

70. In your own words, define the shelter principle. Who does it benefit?

Business Law class. Please short answer

Change Corporation expects an EBIT of $31,200 every year forever. The company currently has no debt, and its cost of equity is 11 percent. a. What is the current value of the company? b. Supposed the company can borrow at 6 percent. If the corporate tax rate is 22 percent, what will the value of the firm be if the company takes on debt equal to 50 percent of its unlevered value? What if it takes on debt equal to 100 percent of its unlevered value? c. What will the value of the firm be if the company takes on debt equal to 50 percent of its levered value? What if the company takes on debt equal to 100 percent of its levered value?

Lyft began operating in 2014. The company lost money the first year but has been profitable ever since.The company’s taxable income (EBT) for its first five years is listed below. Each year the company’s corporate tax rate has been 35%.

Year Taxable Income

2014. 2014 −$5,000,000

2015. 2015 $2,000,000

2016. 2016 $2,000,000

2017. 2017 $2,000,000

2018. 2018 $3,000,000

Assume that the company has taken full advantage of the Tax Code’s carry-back, carry-forward provisions and that the current provisions were applicable in 2014. How much did the company pay in taxes in 2017 and 2018?

1. $700,000 and $1,050,000

2. $350,000 and $1,050,000

3. $800,000 and $1,200,000

4. $600,000 and $900,000

5. None of the above

1.       United Parcel Service (UPS) provides package delivery services throughout the United States and the world. Discuss the impact of seasonal variations in the delivery business for forecasting the firm’s financing requirements.

2.       Dell Computer Corporation (DELL) has long been recognized for its innovative approach to managing its working capital. Describe how Dell pioneered the management of net working capital to free up resources in the firm.

Need 300 words discussion Provide an example of the investment and financing decisions that financial managers make and  Please identify and describe one of the financial market

Financial Projections & Explaining Uncertainties

When doing a financial projection, it is important to always somehow predict the financial cost of the unknowns and to have details surrounding those unknowns. Although they can be scary and cause worry, having detailed historical data or reason behind the uncertainty can help calm an audience almost immediately. In explaining a financial uncertainty, I would recommend starting with pointing out some positives based on the actual numbers. These positives should be the based off of the forecast that was built and defined. From here I would recommend briefly touching upon the fact that things sometimes don’t go as planned; a hurricane wipes out a town, a massive snow storm wipes the power from the state for multiple days or a competitor suddenly starts taking a portion of your customers. All of these things can’t be predicted and are therefore uncertainties. Giving the audience context around what these uncertainties are helps build a solid foundation of understanding.

From here I recommend that communication on the difference in the uncertainty and the actual financial prediction are discussed in great detail. Everything should be outlined, starting with this was our predicted number, this was our final number and these are the reasons we didn’t get to our actual number. It could be that there was an error in the number of days predicted in the month, it could be that the sale Nordstrom rolled out wasn’t discounted enough to sell more products or simply that the number of people predicted to make a purchase at Nordstrom was over projected. A solid reason around why the prediction versus the actual occurred will calm an audience.

Lastly, the audience wants to hear how this will be mitigated going forward and factored into future predictions. Outlining the detail around the uncertainty allows the predictor to learn and comprehend what actually happened versus what was predicted so that historically they can better predict next time as well as aid in calming the audience.

For Chegg: constructively critique my explanations. Support your initial comment and response with sound reasoning and relevant examples.

(Calculating free cash flows​) At​ present, Solartech Skateboards is considering expanding its product line to include​gas-powered skateboards;​ however, it is questionable how well they will be received by skateboarders. Although you feel there is a 50 percent chance you will sell 12,000 of these per year for 10 years​ (after which time this project is expected to shut down because​ solar-powered skateboards will become more​ popular), you also recognize that there is a 25 percent chance that you will only sell 2,000 and also a 25 percent chance you will sell 17,000. The gas skateboards would sell for $130 each and have a variable cost of ​$50 each. Regardless of how many you​ sell, the annual fixed costs associated with production would be $160,000. In​ addition, there would be an initial expenditure of $1,100,000 associated with the purchase of new production equipment. It is assumed that this initial expenditure will be depreciated using the simplified​ straight-line method down to zero over 10 years. Because of the number of stores that will need​ inventory, the working capital requirements are the same regardless of the level of sales. This project will require a​ one-time initial investment of $60,000 in net working​ capital, and that​ working-capital investment will be recovered when the project is shut down.​ Finally, assume that the​ firm's marginal tax rate is 31 percent.

a. What is the initial outlay associated with the​ project?

b. What are the annual free cash flows associated with the project for years 1 through 9 under each sales​ forecast? What are the expected annual free cash flows for years 1 through​ 9?

c. What is the terminal cash flow in year 10​ (that is, what is the free cash flow in year 10 plus any additional cash flows associated with the termination of the​ project)?

d. Using the expected free cash​ flows, what is the​ project's NPV given a required rate of return of 8 percent? What would the​ project's NPV be if 12,000 skateboards were​ sold?

Use Micrsoft Excel 2010 to run a linear regression analysis. What is the value of R² (R-squared)?

QUESTION 5

What does this value for R² (R-squared) suggest about the linear equation that Excel determines as the line of best fit?

QUESTION 6

Identify the coefficients from the Excel Output summary that are used to write the line of best fit for this data. If the equation was written as

                                                y = b₁x + b₀,

where y if the total return value and x is the risk,  what is the value of b₀?

QUESTION 7

Identify the coefficients from the Excel Output summary that are used to write the line of best fit for this data. If the equation was written as

                                                y = b₁x + b₀,

where y if the total return value and x is the risk,  what is  the value of b₁?

QUESTION 10

Use the line of best fit to predict the total return (y-value) for a risk of  x = 11?

Total Return = _________  ?

What is the present value of the following annuity?
$3,899 every year at the end of the year for the next 14 years, discounted back to the present at 12.57 percent per year, compounded annually?

Analyzing Foreign Currency Hedges

The Arizona Company, a U.S.-based manufacturer, ordered a piece of equipment from Sonora Inc., a Mexico-based supplier, agreeing to pay 300,000 Mexican pesos upon delivery of the equipment in three months time. At the time of the contract signing, the exchange rate between the U.S. dollar and the Mexican peso was 10P:$1.

With concerns about a weakening U.S. dollar, The Arizona Company decided to hedge its currency exposure by purchasing a forward foreign exchange contract from a local bank.

The forward contract committed The Arizona Company to pay $30,300 in three months in exchange for 300,000 pesos.

What was the forward foreign exchange rate implicit in the contract (assuming no transaction costs)?

Round to two decimal places. Hint - provide the number of Pesos to each US$.

1.) __________________

If the foreign exchange rate in three months was 9.8P:$1, how much did The Arizona Company save by purchasing the currency hedge?

Round to the nearest dollar.

2.) ________________

If the foreign exchange rate in three months was 9.0P:$1?, how much did the company save by purchasing the currency hedge?

Round answer to the nearest dollar.

3.) __________________

Problem 6

You are evaluating a project to build an oil pipeline in one of the emerging markets. Building the pipeline will take 8 annual investments, each of which is paid at the beginning of the year, starting immediately. The first of these investments is $20 million and the amount of the remaining 7 investments is expected to decrease by 3% per year. The pipeline will commence its operations in year 9 and will transport 3,500,000 barrels of oil per year in perpetuity. As the pipeline owner, you will collect an annual cash flow equal to 10% of the total value of transported oil, with cash flows occurring at the end of each year.

If the discount rate is 12%, what is the minimum price of oil per barrel under which the Profitability Index is 1.05? For simplicity, assume that oil prices are constant over time and that the costs of running the pipeline are negligible.

Company is Amazon

Short Description of Business: What does the company do? What are its key sources of revenue?

Product Mix: Identify the company’s product mix or key segments. Briefly describe each product line/segment. Include brand names if possible

You have been offered an investment that will pay you a lump sum of $30,000 25 years from today, along with a payment of $1,000 per year for 25 years starting one year from today. How much are you willing to invest today to have this investment in your portfolio assuming you wish to earn a rate of 6 percent compounded annually?

Round the answer to the nearest whole number.

1. An EBIT grows from $130.5 M to $404.5 M in 5 years i/ what is its overall growth over the period? ii/ what is its CAGR (i.e. its Compound Annual Growth Rate, also called annualized growth rate)?
2. An EBIT declines from $130.5 M to $44.5 M in 5 years i/ what is its overall decline over the period? ii/ what is its CAGR?