The university finance department wants to know if the average age of students at their university is greater than the average for other universities. A random sample of student records is taken from the own university (population 1) and a random selection of student ages from other three universities are taken (population 2). A significance level of 0.05 is chosen.

The null and alternative hypotheses are:

?0:

??:

The samples are selected, and the results are:

?1 = 28,7 ?????   ?1 = 5.1 ?????   ?1 = 125

?2 = 24,9 ?????   ?2 = 3.5 ?????   ?2 = 250

On January 1, 2020, Charles Corporation purchased 40% of the common shares of River Company for $400,000. During the year, River earned net income of $120,000 and paid dividends of $40,000.

Prepare the entries for Charles to record the purchase and any additional entries related to this investment in River Company in 2020.

1-Which type of bias can be minimized by masking the study subjects to the study hypothesis and by using diseased controls if conducting a case-control study?

2-Which type of bias can be minimized using sensitive and specific criteria to define the exposure and disease?

2. Joanne Jamison

Joanne started with Performance Horizons five years ago, after receiving her MBA from The Wharton School. She has told people the reason she went to Wharton was to have the best opportunities at jobs that would offer quick advancement so she could rapidly rise to the top of the organization. Joanne has a keen sense of what makes organizations tick and who to go to when things need to get done. She doesn’t “waste” her time with chitchat, as she calls it. Her time is all spent on doing a good job on all her assignments and making sure she makes the right connections with the executives. Her performance has always been rated as excellent.

Which two of the four motivates Joanne the most?

Business Week conducted a survey of graduates from 30 top MBA programs (Business Week, September 22, 2003). The survey found that the average annual salary for male and female graduates 10 years after graduation was $168,000 and $117,000, respectively. Assume the population standard deviation for the male graduates is $40,000, and for the female graduates it is $25,000.

When calculating values for z, round to two decimal places.

1. What is the probability that a simple random sample of 40 male graduates will provide a sample mean within $10,000 of the population mean, $168,000 (to 4 decimals)?
   
   
2. What is the probability that a simple random sample of 40 female graduates will provide a sample mean within $10,000 of the population mean, $117,000 (to 4 decimals)?
   
   
3. In which of the preceding two cases, part (a) or part (b), do we have a higher probability of obtaining a sample estimate within $10,000 of the population mean?
   - Select your answer -Part (a) because the population mean for males is higherPart (a) because the population standard deviation for males is higherPart (b) because the population mean for females is lowerPart (b) because the population standard deviation for females is lowerItem 3
   
4. What is the probability that a simple random sample of 100 male graduates will provide a sample mean more than $4,000 below the population mean (to 4 decimals)?

After graduating from college with your MBA, you decide to take your grandma’s secret cinnamon roll recipe and open up a bakery. You grew up devouring your grandma’s rolls, and you have convinced her to give you the secret. You are confident that your bakery will be the next big hit in the fast-food business. You take out a business loan for the maximum amount your bank will give you, hire several employees, and open a beautiful store that is designed to look like your grandma’s home. After eight months of hard work and diligence, you are crushed when you realize that your store manager has been stealing from you. One of your recent hires tells you that during her last shift, the manager, Stephanie, voided a sale of two-dozen cinnamon rolls, stamped the receipt as a return, and pocketed the money. Stephanie warned the new hire not to say anything and told her she deserved the money because she didn’t get paid enough. Encouraged by your open- door policy, the employee confides in you.

1. Identify what symptoms this fraud will generate. In addition, identify how this fraud will directly affect your revenue and inventory accounts.

2. Explain the steps you should take to search for each symptom you identified in part (1). In particular, describe the computer queries and transactions that should be searched to find this fraud.

3. After you have identified several symptoms, do you have enough evidence to prove that she is guilty? What other evidence is required or useful in this case?

4. Besides searching for symptoms of the fraud, what other investigative steps can be taken to elicit a confession or otherwise prove the fraud?

5. What steps could have been taken to prevent this fraud from occurring in the first place?

Sheila Goodman recently received her MBA from the Harvard Business School. She has joined the family business, Goodman Software Products Inc., as Vice-President of Finance. She believes in adjusting projects for risk. Her father is somewhat skeptical but agrees to go along with her. Her approach is somewhat different than the risk-adjusted discount rate approach, but achieves the same objective. She suggests that the inflows for each year of a project be adjusted downward for lack of certainty and then be discounted back at a risk-free rate. The theory is that the adjustment penalty makes the inflows the equivalent of riskless inflows, and therefore a risk-free rate is justified.

A table showing the possible coefficient of variation for an inflow and the associated adjustment factor is shown next:
  

Assume a $125,000 project provides the following inflows with the associated coefficients of variation for each year.
  

  
Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods.

a. Fill in the table below: (Do not round intermediate calculations. Round "Adjustment Factor" answers to 2 decimal places and other answers to the nearest whole dollar.)
  

  
b-1. If the risk-free rate is 6 percent, compute the net present value of the adjusted inflows. (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places.)
  

Sheila Goodman recently received her MBA from the Harvard Business School. She has joined the family business, Goodman Software Products Inc., as Vice-President of Finance. She believes in adjusting projects for risk. Her father is somewhat skeptical but agrees to go along with her. Her approach is somewhat different than the risk-adjusted discount rate approach, but achieves the same objective. She suggests that the inflows for each year of a project be adjusted downward for lack of certainty and then be discounted back at a risk-free rate. The theory is that the adjustment penalty makes the inflows the equivalent of riskless inflows, and therefore a risk-free rate is justified.

A table showing the possible coefficient of variation for an inflow and the associated adjustment factor is shown next:
  

Assume a $185,000 project provides the following inflows with the associated coefficients of variation for each year.
  

  
Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods.

a. Fill in the table below: (Do not round intermediate calculations. Round "Adjustment Factor" answers to 2 decimal places and other answers to the nearest whole dollar.)
  

  
b-1. If the risk-free rate is 7 percent, compute the net present value of the adjusted inflows. (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places.)
  

  
b-2. Should this project be accepted?
  

• Yes

• No

Sheila Goodman recently received her MBA from the Harvard Business School. She has joined the family business, Goodman Software Products Inc., as Vice-President of Finance. She believes in adjusting projects for risk. Her father is somewhat skeptical but agrees to go along with her. Her approach is somewhat different than the risk-adjusted discount rate approach, but achieves the same objective. She suggests that the inflows for each year of a project be adjusted downward for lack of certainty and then be discounted back at a risk-free rate. The theory is that the adjustment penalty makes the inflows the equivalent of riskless inflows, and therefore a risk-free rate is justified.

A table showing the possible coefficient of variation for an inflow and the associated adjustment factor is shown next:
  

Assume a $125,000 project provides the following inflows with the associated coefficients of variation for each year.
  

  
Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods.

a. Fill in the table below: (Do not round intermediate calculations. Round your dollar answers to the nearest whole dollar.)

Year Adjustment Factor Adjusted Inflow

1

2

3

4

5

  
b-1. If the risk-free rate is 6 percent, compute the net present value of the adjusted inflows. (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places.)
  

  
b-2. Should this project be accepted?