Problem 1

Bill can produce either tables or chairs. Bill can work up to 10 hours a day. His production possibilities are given in the table below:

1. Construct the production possibilities frontier (PPF) for Bill. Put tables on the Horizontal axis and chairs on the vertical axis.
2. What is Bill’s opportunity cost of producing one additional table?
3. What is Bill’s opportunity cost of producing one additional chair?
4. Currently Bill is producing 20 tables and 40 chairs.

1. Is this allocation of resources efficient? Why?
2. Show this allocation on the graph and advise Bill how he can be more efficient.

Problem 2

Suppose the market for corn is given by the following equations for supply and demand:

            QS = 2p − 2

            QD = 13 − p

where Q is the quantity in millions of bushels per year and p is the price.

1. Calculate the equilibrium price and quantity.
2. Sketch the supply and demand curves on a graph indicating the equilibrium quantity and price.
3. Calculate the price-elasticity of demand and supply at the equilibrium price/quantity.

4. The government judges the market price is under expectations and announces a price floor equal to $7 per bushel.

1. Would there be a surplus or a shortage?
2. What would be the quantity of excess supply or demand that results?
3. Use the graph to show you results.

Question 1 – Payout Policy

AMC Corporation currently has an enterprise value of $400 million and $100 million in excess cash. The firm has 10 million shares outstanding and no debt. Suppose AMC uses its excess cash to repurchase shares. After the share repurchase, news will come out that will change AMC’s enterprise value to either $600 million or $200 million.

Required:

1. What is AMC’s share price prior to the share repurchase?
2. What is AMC’s share price after the repurchase if its enterprise value goes up? What is AMC’s share price after the repurchase if its enterprise value declines?
3. Suppose AMC waits until after the news comes out to do the share repurchase. What is AMC’s share price after the repurchase if its enterprise value goes up? What is AMC’s share price after the repurchase if its enterprise value declines?
4. Suppose AMC management expects good news to come out. Based on your answers to requirements (2) and (3), if management desires to maximize AMC’s ultimate share price, will they undertake the repurchase before or after the news comes out? When would management undertake the repurchase if they expect bad news to come out?
5. Given your answer to requirement (4), what effect would you expect an announcement of a share repurchase to have on the stock price? Why?
6. do in the word file or excel file

Problem 1

Bill can produce either tables or chairs. Bill can work up to 10 hours a day. His production possibilities are given in the table below:

1. Construct the production possibilities frontier (PPF) for Bill. Put tables on the Horizontal axis and chairs on the vertical axis.
2. What is Bill’s opportunity cost of producing one additional table?
3. What is Bill’s opportunity cost of producing one additional chair?
4. Currently Bill is producing 20 tables and 40 chairs.

1. Is this allocation of resources efficient? Why?
2. Show this allocation on the graph and advise Bill how he can be more efficient.

Problem 2

Suppose the market for corn is given by the following equations for supply and demand:

            QS = 2p − 2

            QD = 13 − p

where Q is the quantity in millions of bushels per year and p is the price.

1. Calculate the equilibrium price and quantity.
2. Sketch the supply and demand curves on a graph indicating the equilibrium quantity and price.
3. Calculate the price-elasticity of demand and supply at the equilibrium price/quantity.

4. The government judges the market price is under expectations and announces a price floor equal to $7 per bushel.

1. Would there be a surplus or a shortage?
2. What would be the quantity of excess supply or demand that results?
3. Use the graph to show you results.

AMC Corporation currently has an enterprise value of $400 million and $100 million in excess cash. The firm has 10 million shares outstanding and no debt. Suppose AMC uses its excess cash to repurchase shares. After the share repurchase, news will come out that will change AMC’s enterprise value to either $600 million or $200 million.

1. What is AMC’s share price prior to the share repurchase?

2. What is AMC’s share price after the repurchase if its enterprise value goes up? What is AMC’s share price after the repurchase if its enterprise value declines?

3. Suppose AMC waits until after the news comes out to do the share repurchase. What is AMC’s share price after the repurchase if its enterprise value goes up? What is AMC’s share price after the repurchase if its enterprise value declines?

4. Suppose AMC management expects good news to come out. Based on your answers to parts b and c, if management desires to maximize AMC’s ultimate share price, will they undertake the repurchase before or after the news comes out? When would management undertake the repurchase if they expect bad news to come out?

5. Given your answer to part d, what effect would you expect an announcement of a share repurchase to have on the stock price? Why?

Honolulu Airlines flies only one route: Chicago-Honolulu. The demand for each flight is Q = 500- P. HA’s cost of running each flight is $41,000 plus $100 per passenger.

1. What is the profit maximizing price that HA will charge if the market is a monopoly? How many people will be on each flight? What is HA’s profit for each flight? Will the airline stay in business?

2. HA finds out that two different types of people fly to Honolulu. Type A consists of business people with a demand of Q_{A = 260 - 0.4P.Type B consists of students whose total demand is QB = 240 - 0.6P.} Because the students are easy to spot, HA decides to charge each group different prices. Graph each of these demand curves and their horizontal sum (the market demand curve). What price does HA charge the students? What price does it charge to business customers?

3. What would HA’s profit be for each flight? Would the airline stay in business? Calculate the consumer

surplus of each group. What is the total CS?

4. Before HA started price discrimination, how much CS was the Type A getting? What about Type B? Why did total CS decline with price discrimination? In our price discrimination worksheet, the CS was higher with third degree price discrimination. Explain the discrepancy between the two results.

ANSWER ALL PARTS PLEASE

Presenting Problems/Issues:

Patient is a 68 y/o married Hispanic female presenting for psychiatric evaluation and medication management. Patient see with husband. She reports she has been anxious since her early twenties, but since her 36 year old daughter died last year (3/18/17). Patient reports feelings of depression, sadness, lack of focus, tearfulness, hopelessness, helplessness, guilt, anxiety with panic attacks, worthlessness, irritability, forgetfulness, anhedonia, not wanting to leave house, poor sleep, passive suicide ideations, stating “I want to be with my daughter and God.” Convincingly denies plan and intent, stating “I am Catholic and I wouldn’t go to heaven if I took my pills and died.” Denies HI and auditory hallucinations, reports visual hallucinations of daughter. Husband offers collateral information, “she’s even afraid to die and wakes up disoriented at 830 pm and thinks its 830 am.”

Denies history of homicide attempts/ideations. No weapons or firearms at home.

PCP has been prescribing Xanax 1 mg TID ‘for years’ with good effect. Xanax was recently switched to clonazepam 2 mg BID – causing sedation. NJ PMP aware verified.

PCP also prescribed Effexor 75 mg HS 2 months ago and increased dose to 150 mg with poor effect.

Has over the phone grief counseling with insurance company with good effect, attends a support group and is looking forward to beginning a depression program through her insurance company.

Substance Use & Abuse History: (Include substance abuse treatment)

Denies ETOH abuse – ‘just a small drink once a week.’ Denies other history of other illicit drug usage, or abuse of prescription medications.

Former smoker.

Allergies & Adverse Drug Reactions: NKA

Family Psychiatric History:. Denies family history of psych treatment or suicides.

Other Relevant Psychosocial History: (developmental, social, educational, vocational, trauma, etc.)

Lives with Husband who works 2pm – 10 pm+ Married 40 years.

Grieving after loss of daughter (36 y/o living in supportive housing – Dx hydrocephalus)

Employment: Retired 10 years ago. Worked with computers.

Trauma hx: Death of daughter

Emigration to US from Cuba at age 15. Speaks English fluently now.

Denies child abuse/neglect, rapes, domestic violence.

Relevant Legal Issues: No history of arrests or current legal issues reported.

Medical History: (Significant illness and treatment, surgery, head trauma, exposure to toxins, etc.)

Reports ‘stomach issues,” HTN, high cholesterol, COPD, psoriasis. Denies DM and hypothyroidism. Reports cholecystectomy & hysterectomy. Followed by DR XXXXX. Last seen 2 weeks ago. Medically stable. Denies other history of major medical hospitalizations, surgeries, seizures, or concussions reported.

Takes iron infusions, nexum, Losartan, Topral xl, liptor, Advair.

Mental Status Examination:                                                                                                  

            Appearance and Behavior: Well groomed, overweight, cooperative with interviewer

              Affect: sad, tearful

              Mood: “sad”

              Speech: Normal rate, soft spoken, normal production

              Thought:

                Process: Goal directed

                Content: Relevant to conversation

        Delusions: Denies current paranoid delusions

Perception:

   Hallucinations: Denies current auditory hallucinations. Reports seeing deceased daughter.

Suicidal/Violent Ideation, Impulse, Intent: Denies current suicidal/homicidal ideation or plans

              Cognition:

                      Orientation: Alert, awake, oriented x 3

   Memory:   Recent   Intact     Remote:   Intact

                          Abstraction: Age appropriate.

              Judgment, Insight: Insight – good Judgment – good

Patient is proactive in seeking treatment and recognizes the need for medication to stabilize her mood and thoughts

Consumer’s Expressed Interests, Preferences, Strengths and Goals: (Related to behavioral health services, valued roles, and quality of life)

Strengths: proactive, supportive husband

Goals: “To have a life, volunteer.”

Student APN’s Name:

Other information you might want?

Clinical Impressions: (Rationale for diagnosis and recommendations for services)

DSM-5 Diagnosis:                                   

Recommendations:

Labs:

Psychiatric Medications:                                                                                                                                                                                         

Drug:                                            Dose/Schedule:                            Number/Refill:                                           Fact Sheet Given     Other

Rationale for each recommendation:

Teaching:

FOLLOW UP___________________

Perot Corporation is developing a new CPU chip based on a new type of technology. Its new chip, the Patay2 chip, will take two years to develop. However, because other chip manufacturers will be able to copy the technology, it will have a market life of two years after it is introduced. Perot expects to be able to price the chip higher in the first year, and it anticipates a significant production cost reduction after the first year as well. The relevant information for developing and selling the Patay2 is given as follows:

PATAY2 CHIP PRODUCT ESTIMATES

Development cost $ 20,000,000

Pilot testing $ 5,000,000

Debug $ 3,200,000

Ramp-up cost $ 3,000,000

Advance marketing $ 5,400,000

Marketing and support cost $ 1,000,000 per year

Unit production cost year 1 $ 655.00

Unit production cost year 2 $ 545.00

Unit price year 1 $ 820.00

Unit price year 2 $ 650.00

Sales and production volume year 1 - 250,000

Sales and production volume year 2 - 150,000

Interest rate 10 % Assume all cash flows occur at the end of each period.

a. What is the net present value (at the discount rate of 10%) of this project? (Negative value should be indicated by a minus sign. Enter your answer in thousands of dollars. Round your answer to the nearest thousand.)

b. Perot’s engineers have determined that spending $10 million more on development will allow them to add even more advanced features. Having a more advanced chip will allow them to price the chip $50 higher in both years ($870 for year 1 and $700 for year 2). What is the NPV of the project if this option is implemented? (Negative value should be indicated by a minus sign. Enter your answer in thousands of dollars. Round your answer to the nearest thousand.)

c. If sales are only 200,000 the first year and 100,000 the second year, what would the NPV of the project be? Assume the development costs and sales price are as originally estimated. (Negative value should be indicated by a minus sign. Enter your answer in thousands of dollars. Round your answer to the nearest thousand.)

Chapter 3 - The Research Process (#1,5,6,7,8,10,13 in your text)

You have just been assigned to provide client services to the following entities. For each, identify three resources you could consult in order to better understand the company's business model and industry.

a. Pfizer

b. Southwest Airlines

c. Caesars Entertainment

You are once again in the first step of the research process (understanding the facts). Now, your company is looking to repurchase some of its outstanding stock. You are about to attend a meeting between representatives of your company's Treasury department and a bank at a fixed price on a certain date. Identify three resources you could consult or questions you might ask of others on your team or in the organization, to gather additional background/ precedent for this issue before you attend the meeting.

Identify at least one researchable question for each of the following issues.

A cable network has just entered into an agreement granting it the right to show reruns of a hit TV series. In exchange for this right, the network must pay the TV show's creators a fee each time the show airs.

An online restaurant booking site sells a $100 meal voucher, good for $100 towards a meal at Randall's Steakhouse, to a customer for $60. When the customer presents the voucher to Randall's Steakhouse, the restaurant booking site must remit $50 to Randall's, retaining $10.

A company's auditor is questioning the appropriateness of the company's discount rate assumption, which it uses to measure its defined benefit pension obligation.

Automotive, Inc. has announced the sale of it's Truck Division's three plants, along with planned layoffs of the Truck Division's employees. Automotive, Inc. is hoping to segregate the results of the Truck Division's operations in its financial statements. Identify at least two possible research questions.

Cancico Communications has supplied the following data for use in its ABC system: Overhead Costs Wages and salaries $ 300,000 Other overhead costs 165,000 Total overhead costs $ 465,000 Activity Cost Pool Activity Measure Total Activity Direct labour support Number of direct labour-hours 12,300 DLHs Order processing Number of orders 500 orders Customer support Number of customers 180 customers Other These costs are not allocated to products or customers NA Distribution of Resource Consumption across Activity Cost Pools Direct Labour Support Order Processing Customer Support Other Total Wages and salaries 15 % 40 % 35 % 10 % 100 % Other overhead costs 10 % 25 % 25 % 40 % 100 % During the year, Cancico Communications completed an order for special telephone equipment for a new customer, HurnTel. This customer did not order any other products during the year. Data concerning that order follow: Selling price $ 217 per unit Units ordered 190 units Direct materials $ 196 per unit Direct labour-hours 0.6 DLH per unit Direct labour rate $ 26 per DLH Required: 1. Prepare a report showing the first-stage allocations of overhead costs to the activity cost pools. 2. Compute the activity rates for the activity cost pools. (Round your answers to 2 decimal places.) 3. Prepare a report showing the overhead costs for the order from HurnTel, including customer support costs. (Round your answers to 2 decimal places.) 4. Prepare a report showing the customer margin for HurnTel. (Round your answers to 2 decimal places.) please put in graphs