Business Weekly conducted a survey of graduates from 30 top MBA programs. On the basis of the survey, assume the mean annual salary for graduates 10 years after graduation is 167000 dollars. Assume the standard deviation is 32000 dollars. Suppose you take a simple random sample of 100 graduates.

Find the probability that a single randomly selected salary is more than 162000 dollars.
P(X > 162000) = _______

Find the probability that a sample of size n=100 is randomly selected with a mean that is more than 162000 dollars.
P(M > 162000) = _________

Enter your answers as numbers accurate to 4 decimal places.

Business Weekly conducted a survey of graduates from 30 top MBA programs. On the basis of the survey, assume the mean annual salary for graduates 10 years after graduation is 123000 dollars. Assume the standard deviation is 37000 dollars. Suppose you take a simple random sample of 69 graduates. Find the probability that a single randomly selected salary is less than 126000 dollars. Answer = Find the probability that a sample of size n = 69 is randomly selected with a mean that is less than 126000 dollars. Answer = Enter your answers as numbers accurate to 4 decimal places.

Business Weekly conducted a survey of graduates from 30 top MBA programs. On the basis of the survey, assume the mean annual salary for graduates 10 years after graduation is $121,000. Assume the standard deviation is $42,000. Suppose you take a simple random sample of 42 graduates. Round all answers to four decimal places if necessary. What is the distribution of X ? X ~ N( , ) What is the distribution of ¯ x ? ¯ x ~ N( , ) For a single randomly selected graduate, find the probability that her salary is between $122,679 and $130,519. For a simple random sample of 42 graduates, find the probability that the average salary is between $122,679 and $130,519. For part d), is the assumption of normal necessary? YesNo

Hurricane Harvey caused a net loss of $127 Billion. Let us assume that in any given year the net loss would be the same for the next 10 years (Jan 1, 2020 to Dec 31, 2029) if a Harvey like hurricane were to recur in Houston and adjoining areas. However, if certain investments are made in 2019 to mitigate risks and enhance resilience in the region, the expected loss can be reduced significantly. Let us assume that scientists, engineers and policy experts have worked together to estimate that if the investments are indeed made in 2019 the net loss would reduce to 10% (i.e., $12.7 Billion expected net loss per year over the period from 2020 to 2029 if a hurricane like Harvey were to recur) but additional investments of $ 6.35 Billion would be needed each year to maintain the investments. At the end of 2029 the salvage value of the investments would be 20% of the cost of the original investment. Other than this salvage value there would be no other costs or gains expected after the 10-year period. According to a Presidential tweet at the time, Harvey was a 500-year event. Assuming this probability assessment to be accurate, what present (2019) investment would be justified from a net present worth perspective? Please feel free to make any appropriate assumptions but try to state them clearly.

Chapman Company obtains 100 percent of Abernethy Company’s stock on January 1, 2020. As of that date, Abernethy has the following trial balance:

During 2020, Abernethy reported net income of $117,500 while declaring and paying dividends of $15,000. During 2021, Abernethy reported net income of $171,250 while declaring and paying dividends of $55,000.

Assume that Chapman Company acquired Abernethy’s common stock for $816,280 in cash. Assume that the equipment and long-term liabilities had fair values of $396,950 and $140,720, respectively, on the acquisition date. Chapman uses the initial value method to account for its investment.

Prepare consolidation worksheet entries for December 31, 2020, and December 31, 2021. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

• Prepare entry S to eliminate stockholders' equity accounts of subsidiary.
• Prepare entry A to recognize allocations in connection with acquisition-date fair values.
• Prepare entry I to eliminate intra-entity dividends.
• Prepare entry E to recognize 2020 amortization expense.
• Prepare entry *C to convert parent company figures to equity method.
• Prepare entry S to eliminate stockholders' equity accounts of subsidiary for 2021.
• Prepare entry A to recognize allocations attributed to specific accounts at acquisition date for 2021.
• Prepare entry A to recognize allocations in connection with acquisition-date fair values.
• Prepare entry E to recognize 2021 amortization expense.

1. The Cinci Company issues $100,000, 10% bonds at 103 on April 1, 2020. The bonds are dated January 1, 2020 and mature six years from that date. Straight-line amortization is used. Interest is paid annually each December 31. Compute the bond carrying value as of December 31, 2023.

Answer

$_______________

Suppose that the shareholders can hire a board of directors to monitor the CEO. The board of directors cannot perfectly monitor the effort level of the CEO, but hiring the board of directors increases the chance that they observe the true effort level of the CEO. The cost of hiring the board of directors to the shareholders is z. If hired, the board of directors will observe the effort level of the CEO with probability ½. Assume that the CEO can choose from two effort levels: high (e=1) and low (e=0). The cost of each unit of effort is c. Assume that the shareholders will pay a wage of w to the shareholder. However, if the board of directors observes low effort by the agent, then the shareholders will pay a wage of zero to the CEO. If the CEO chooses high effort the shareholders receive a payoff of Y and if the CEO chooses low effort the shareholders receive a payoff of zero. The shareholders first choose to hire the board of directors or not, then the CEO chooses the effort level.

a) Draw the game tree (Hint: only the shareholders and CEO should be in the game tree. The board of directors only influences the payoffs at the end of the tree).

b) If the shareholders hire the board of directors, then what condition must hold for the CEO to choose high effort? (Hint: The payoff for high must be greater than choosing low.)

c) If the shareholders do not hire the board of directors, then what condition must hold for the CEO to choose high effort? (Hint: The payoff for high must be greater than choosing low.)

d) Suppose that the CEO will choose low effort if the shareholders do not hire a board of directors, but will choose high effort if the shareholders do hire a board of directors. What condition must hold for the shareholders to hire a board of directors? (Hint: The payoff for hire given what the CEO will do must be greater than the payoff of not hiring given what the CEO will do).

1. Suppose an investment fund manager considers investing $10,000,000 either in one-year (1Y) US Treasury note or in a corresponding UK Government one-year bond (UK 1Y Gilt). The UK investment would be covered with a one-year forward contract. The current yield on a 1Y US Government bond was 0.13% (+0.0013), while the yield on a 1Y UK bond was -0.02% (-0.0002) on October 7, 2020 (at 3:50pm EST, Bloomberg data). The GBP in USD spot rate was 1.2918 and the 1Y forward rate was 1.2948.

1. Compute the one-year USD return on investment in the US Government bond.

Imagine that you are part of the management team for Econsoft, a computer software company. You are discussing one of your products, “Econblaster,” with the company’s CEO and the other managers. You have made the software available for download on your firm’s website for download for $9.99 and you are trying to figure out how to generate more revenue from the product. Half of the management team suggests increasing the price to $11.99. The other half advocates cutting the price to $7.99. Both sides claim that their idea will increase total revenue generated from the product.

The CEO turns to you to help explain what’s going on. “How can half of the team suggest one thing, and the other half the exact opposite? Who is right? What should we do?”

What do you think? What does the right answer depend on?

Lamarck, in part, based his erroneous theory of evolution on the passing of acquired characteristics from one generation to the next. Darwin’s theory is based on the passing of inherited genetic characteristics from one generation to the next. Determine which of the characteristics listed below are acquired, inherited or involve both acquired and inherited

Explain your choices.

1. Increased proficiency in playing the clarinet: acquired or inherited or both

2. Thick subcutaneous fat layer in arctic seals: acquired or inherited or both

3. Attaining a height of two meters in humans: acquired or inherited or both

4. Grizzly bears hibernating during the winter: acquired or inherited or both