Your company needs a machine for the next seven years, and you have two choices.

Machine A: costs $113000 and has an annual operating cost of $31000. Machine A has a useful life of seven years and a salvage value of $15600 at the end of 7 years.

Machine B: costs $233000 and has an annual operating cost of $5000. Machine B has a useful life of five years and no salvage value. However, the life of machine B can be extended by two years with a major overhaul. If machine B’s life is extended, it will still cost $5000 annually to operate and still have no salvage value.

What is the maximum amount that you would pay at the end of year 5 to extend the life of machine B by two years? Use AEC method. Assume an annual interest rate of 8.3%.

SHOW ALL WORK

2 10 6 10 10 4 5 4 5 8

a) Calculate the range.

b) Calculate the variance.

(Round to two decimal places as needed.)

c) Calculate the standard deviation.

(Round to two decimal places as needed.)

13 28 30 17 24 9 44 21

a​)Determine the 20th percentile.

b​)Determine the 30th percentile.

c​)Determine the 70th percentile.

question13: TABLE 14-1

A manager of a product sales group believes the number of sales made by an employee ( Y) depends on how many years that employee has been with the company ( X ₁) and how he/she scored on a business aptitude test ( X ₂). A random sample of 8 employees provides the following:

Referring to Table 14-1, for these data, what is the estimated coefficient for the variable representing scores on the aptitude test?

question 14:

TABLE 14-1

A manager of a product sales group believes the number of sales made by an employee ( Y) depends on how many years that employee has been with the company ( X ₁) and how he/she scored on a business aptitude test ( X ₂). A random sample of 8 employees provides the following:

Referring to Table 14-1, if an employee who had been with the company 5 years scored a 9 on the aptitude test, what would his estimated expected sales be?

If electricity power failures occur according to a Poisson distribution with an average of 3 failures every twenty weeks:

a) Calculate the probability that there will not be more than one failure during a particular week.

b) What is the distribution of the time between power failures?

c) What is the probability that the time between two power failures is between 15 and 30 weeks?

d) What is the probability that the time between two power failures is at least 40 weeks given that it has already been 20 weeks since the last failure?

A U.S. based internet company offers an on-line proficiency course in
basic accounting. Completion of this online course satisfies the "Fundamentals of Accounting"
course requirement in many MBA programs. In the first semester 315 students have enrolled in
the course. The marketing research manager divided the country into seven regions of
approximately equal populations. The course enrollment values in each of the seven regions
are given below. The management wants to know if there is equal interest in the course across
all regions. (Hint: To answer this question you must determine the expected frequency per
region if it is equal)
a. State the null and alternative hypotheses
b. What is the test statistic?
c. Using a .05 significance level, what is the decision rule?
d. Show the test statistic and essential calculations.
e. Interpret you results

Region    1 2    3    4 5 6    7

enrollment 45 60 30 40 50 55 35

McCormick & Company is considering a project that requires an initial investment of $24 million to build a new plant and purchase equipment. The investment will be depreciated as a modified accelerated cost recovery system (MACRS) seven-year class asset. The new plant will be built on some of the company's land, which has a current, after-tax market value of $4.3 million.

The company will produce bulk units at a cost of $130 each and will sell them for $420 each. There are annual fixed costs of $500,000. Unit sales are expected to be $150,000 each year for the next six years, at which time the project will be abandoned. At that time, the plant and equipment is expected to be worth $8 million (before tax) and the land is expected to be worth $5.4 million (after tax).

To supplement the production process, the company will need to purchase $1 million worth of inventory. That inventory will be depleted during the final year of the project. The company has $100 million of debt outstanding with a yield to maturity of 8 percent, and has $150 million of equity outstanding with a beta of 0.9. The expected market return is 13 percent, and the risk-free rate is 5 percent. The company's marginal tax rate is 40 percent.

Questions

1. What will be the tax depreciation each year?

2. What will be the value of the plant and equipment for tax purposes in year six? Will it be sold for a gain or a loss, and what will the tax effect be?

3. What is the weighted average cost of capital (WACC)?

4. What is the salvage cash flow of the new equipment? Include the income tax effect.

5. What is the total operating cash flows, given the following operating cash flows:

Sales = 150,000 x $420 = $63,000,000

Costs = 150,000 x $130 + $500,000 = $20,000,000

6. Create an after-tax cash flow timeline.

7. What are the total expected cash flows at the end of year six? The $4.3 million is an opportunity cost and must be included at date zero as a cash outflow. If the project is accepted, however, the land can be sold in six years for $5.4 million.

8. Find the NPV using the after-tax WACC as the discount rate.

9. Find the IRR.

10. Should the project be accepted? Discuss whether NPV or IRR creates the best decision rule.

Monshimout is a game from the Cheyenne people and played by women. It could be played by two or more players, and if played by more than two, then the players divided into two equal teams. Game equipment consisted of five plum stones and a basket made of woven grass or willow twigs. The basket measured 3-4 inches deep, 8 inches across at the top, and almost 1/2 inch thick. The plum stones were left plain on one side, but marked on the opposite side. Three were marked using a pattern similar to markings the women used when painting their face: a cross (used on the bridge of the nose), and side marks (used on cheeks, forehead, and chin). The other two stones were marked with a representation of a bear's foot. The players sat opposite each other, in two rows if more than one player. Each player has eight sticks which represent the points she must score to win. When a player has won all the sticks belonging to her opponent she has won the game and the stakes wagered. If teams are playing, each member wins or loses according to the winnings or losses of the teammate in control of the basket and stones. A throw of the stones is done this way. The stones are placed into the basket and the basket is raised slightly and the stones tossed only a few inches and caught in the basket. The basket is then brought down firmly onto the ground so that it strikes the ground with a slight noise. The manner in which the stones land in the basket determine the points scored or lost, as well the control of the throw. A player continues to throw so long as she throws a scoring toss, if she throws a toss with no score the throw passes to her opponent or to the next player. If teams are playing it passes to the thrower's teammate and continues as such until the last teammate throws. If the last member of a team throws a zero score the throw passes to the opposing team. The scoring is as follows: 5 blanks = 1 (the thrower takes 1 stick) 3 blanks, 2 bears = 1 (thrower takes 1 stick) 2 bears, 2 crosses, 1 blank = 1 (thrower takes 1 stick) 2 blanks, 3 crosses = 3 (thrower takes 3 sticks) 2 bears, 3 crosses = 8 (thrower takes 8 sticks and wins game) Assuming that each stone has equal chance of landing on either side, compute the following: The probability of 5 blanks: =

The probability of 3 blanks, 2 bears: =

The probability of 2 bears, 2 crosses and 1 blank: =

The probability of 2 blanks, 3 crosses: =

The probability of 2 bears, 3 crosses: =

A crossover trial is a type of experiment used to compare two drugs. Subjects take one drug for a period of time, then switch to the other. The responses of the subjects are then compared using matched-pair methods. In an experiment to compare two pain relievers, seven subjects took one pain reliever for two weeks, then switched to the other. They rated their pain level from 1 to 10, with larger numbers representing higher levels of pain. Can you conclude that the main pain level is less with drug B? Use α = 0.05.

a. State whether the test is:

i) a two-sample t-test (independent samples)

ii) a matched pairs

iii) a two sample proportion test

b. Write H0 and H1

c. Using Minitab, list the test statistic the p-value your conclusion: reject H0 or do not reject H0. Note: if α is not provided, use a 0.05 significance level

d.   Write a sentence that explains your conclusion in context with the claim. Include the significance level and p-value in this sentence.

e.   Copy and paste the relevant Minitab output into the document. Answers alone are sufficient, you do not need to copy the exercise into the document.

1. What is (Keynesian) Monetary Policy? (Explain/Discuss with emphasis on ONE of the bullets)
   • Discuss the last two recessions (2007-8 and 2020) in terms of monetary policy.
   • Discuss bank regulation following the Great Depression and bank deregulation starting in the 1980’s.  How was this a factor in the financial crisis?