Questions
You are an entrepreneur starting a biotechnology firm. If your research is​ successful, the technology can...

You are an entrepreneur starting a biotechnology firm. If your research is​ successful, the technology can be sold for $26 million. If your research is​ unsuccessful, it will be worth nothing. To fund your​ research, you need to raise $3.8 million. Investors are willing to provide you with $3.8 million in initial capital in exchange for 40% of the unlevered equity in the firm.

a. What is the total market value of the firm without​ leverage?

b.Suppose you borrow $0.8 million. According to​ MM, what fraction of the​ firm's equity will you need to sell to raise the additional $3.0 million you​ need?

c. What is the value of your share of the​ firm's equity in cases

​(a​)

and

​(b​)?

a. What is the total market value of the firm without​ leverage?

The market value without leverage is

​$nothing

million.  ​(Round to one decimal​ place.)

b.

Suppose you borrow

$ 0.8$0.8

million. According to​ MM, what fraction of the​ firm's equity will you need to sell to raise the additional

$ 3.0$3.0

million you​ need?The fraction of the​ firm's equity you will need to sell is

nothing​%.

​(Round to the nearest whole​ percentage.)c. What is the value of your share of the​ firm's equity in cases

​(a​)

and

​(b​)?

The value of your share of the​ firm's equity:

Case

​(a​)

is

​$nothing

million.  ​(Round to one decimal​ place.)Case

​(b​)

is

​$nothing

million.  ​(Round to one decimal​ place.)

In: Finance

Develop a three-week moving average for this time series. Compute MSE and a forecast for week...

Develop a three-week moving average for this time series. Compute MSE and a forecast for week 7. Round your answers to two decimal places.


Week		 Time Series
Value
Forecast
1 18  
2 13  
3 16  
4 11  
5 17  
6 14  


MSE :

The forecast for week 7 :

Use = 0.2 to compute the exponential smoothing values for the time series. Compute MSE and a forecast for week 7. Round your answers to two decimal places.


Week		 Time Series
Value
Forecast
1 18  
2 13  
3 16  
4 11  
5 17  
6 14  


MSE :

The forecast for week 7 :

Compare the three-week moving average forecast with the exponential smoothing forecast using = 0.2. Which appears to provide the better forecast based on MSE?



Explain.

The input in the box below will not be graded, but may be reviewed and considered by your instructor.


Use trial and error to find a value of the exponential smoothing coefficient that results in a smaller MSE than what you calculated for = 0.2. Find a value of for the smallest MSE. Round your answer to three decimal places.

=

In: Other

Consider the following gasoline sales time series. If needed, round your answers to two-decimal digits. Week...

Consider the following gasoline sales time series. If needed, round your answers to two-decimal digits.

Week Sales (1,000s of gallons)
1 17
2 23
3 14
4 25
5 17
6 16
7 22
8 19
9 21
10 19
11 17
12 23
(a) Show the exponential smoothing forecasts using α = 0.1, and α = 0.2.
Exponential
Smoothing
Week α = 0.1 α = 0.2
13
(b) Applying the MSE measure of forecast accuracy, would you prefer a smoothing constant of α = 0.1 or α = 0.2 for the gasoline sales time series?
An - Select your answer -α = 0.1α = 0.2Item 3 smoothing constant provides the more accurate forecast, with an overall MSE of  .
(c) Are the results the same if you apply MAE as the measure of accuracy?
An - Select your answer -α = 0.1α = 0.2Item 5 smoothing constant provides the more accurate forecast, with an overall MAE of  .
(d) What are the results if MAPE is used?
An - Select your answer -α = 0.1α = 0.2Item 7 smoothing constant provides the more accurate forecast, with an overall MAPE of  .

In: Statistics and Probability

Consider the following gasoline sales time series. If needed, round your answers to two-decimal digits. Week...

Consider the following gasoline sales time series. If needed, round your answers to two-decimal digits.

Week Sales (1,000s of gallons)
1 16
2 22
3 17
4 23
5 15
6 17
7 21
8 19
9 20
10 18
11 15
12 23
(a) Show the exponential smoothing forecasts using α = 0.1, and α = 0.2.
Exponential
Smoothing
Week α = 0.1 α = 0.2
13
(b) Applying the MSE measure of forecast accuracy, would you prefer a smoothing constant of α = 0.1 or α = 0.2 for the gasoline sales time series?
An - Select your answer -α = 0.1α = 0.2Item 3 smoothing constant provides the more accurate forecast, with an overall MSE of  .
(c) Are the results the same if you apply MAE as the measure of accuracy?
An - Select your answer -α = 0.1α = 0.2Item 5 smoothing constant provides the more accurate forecast, with an overall MAE of  .
(d) What are the results if MAPE is used?
An - Select your answer -α = 0.1α = 0.2Item 7 smoothing constant provides the more accurate forecast, with an overall MAPE of  .

In: Statistics and Probability

Annual high temperatures in a certain location have been tracked for several years. Let X represent...

Annual high temperatures in a certain location have been tracked for several years. Let X represent the number of years after 2000 and Y the high temperature. Based on the data shown below, calculate the linear regression equation using technology (each constant to 2 decimal places).

x y
2 34.82
3 33.28
4 34.84
5 35.1
6 33.26
7 35.42
8 34.18
9 34.54
10 34.4
11 35.86
12 35.12
13 37.88



The equation is?

Interpret the slope

  • For each additional 0.2 years, the annual high temperature will increase by 1 degree on average.
  • For each additional year, the annual high temperature will increase by 33.41 degrees on average.
  • For each additional year, the annual high temperature will increase by 0.2 degrees on average.
  • For each additional 33.41 years, the annual high temperature will increase by 1 degree on average.



Interpret the y-intercept

  • It does not make sense to interpret the intercept in this scenario.
  • In 2002, the temperature was about 0.2.
  • In 2013, the temperature was about 37.88.
  • In 2000, the temperature was about 33.41.
  • In 2002, the temperature was about 33.41.

In: Statistics and Probability

Consider the following gasoline sales time series. If needed, round your answers to two-decimal digits. Week...

Consider the following gasoline sales time series. If needed, round your answers to two-decimal digits.

Week Sales (1,000s of gallons)
1 17
2 21
3 16
4 24
5 17
6 18
7 22
8 20
9 21
10 19
11 16
12 25
(a) Show the exponential smoothing forecasts using α = 0.1, and α = 0.2.
Exponential
Smoothing
Week α = 0.1 α = 0.2
13
(b) Applying the MSE measure of forecast accuracy, would you prefer a smoothing constant of α = 0.1 or α = 0.2 for the gasoline sales time series?
An - Select your answer -α = 0.1α = 0.2Item 3 smoothing constant provides the more accurate forecast, with an overall MSE of  .
(c) Are the results the same if you apply MAE as the measure of accuracy?
An - Select your answer -α = 0.1α = 0.2Item 5 smoothing constant provides the more accurate forecast, with an overall MAE of  .
(d) What are the results if MAPE is used?
An - Select your answer -α = 0.1α = 0.2Item 7 smoothing constant provides the more accurate forecast, with an overall MAPE of  .

In: Statistics and Probability

Consider a firm which sells its product in a perfectly competitive market where the market price...

Consider a firm which sells its product in a perfectly competitive market where the market price is $4.20 per unit. The firms in the market have identical cost structures and is described by the following equations:

TC = 40 + 0.1q2(squared) - 0.2q
ATC = 40/q + 0.1q- 0.2
MC = 0.2q - 0.2
AVC= 0.1q - 0.2

1.a) What quantity should the firm produce to maximize its profit?
1.b) What is the firm’s profit at its profit-maximizing level of output?
1.c) If the current market quantity is 2750, how many firms are there in the market?

Suppose consumers’ income decreases, and consumers view this good as a normal good. As a result, the new market price is $3.20.

5.a) Given the new market price of $3.20, the firm’s profit-maximizing level of output is ________.

6.) As a result of the market price change, the firm should expect its profit to ______ ( decrease | increase | not change) by $___________.

7.) Given the firm’s cost structure, the firm will earn an economic profit (profit greater than zero) if the market price is _________ (equal to | greater than | less than | not equal to) $________.

In: Economics

Lora Corp. anticipates a non-constant growth pattern for dividends. Dividends are expected to be $1.30 next...

Lora Corp. anticipates a non-constant growth pattern for dividends. Dividends are expected to be $1.30 next year followed by a 15% growth rate until the end of year five. At this time dividends will grow at a 5% rate for the foreseeable future. Use a discount rate of 12% (Ke) throughout your analysis. Round all values that you compute to two places to the right of the decimal point. Calculate Po

  1. Show the table to calculate for PV (dividend from year 1 to year 5) (with 3 columns) (0.6 point)
  2. Show PV (dividend for year 1 to year 5) (0.1 point)
  3. Show formula to find the price at year 5 (0.1 point)
  4. Show work to find the price at year 5 (0.2 point)
  5. Present price for year 5 (0.1 point)
  6. Show formula to find the PV (price for year 5) (0.2 point)
  7. Show work to find the price at year 5 (0.1 point)
  8. Present PV (price for year 5) (0.1 point)
  9. Show work to the price of this stock (0.2 point)
  10. Present price of this stock (0.1 point)

In: Finance

Consider the following gasoline sales time series. If needed, round your answers to two-decimal digits. Week...

Consider the following gasoline sales time series. If needed, round your answers to two-decimal digits.

Week Sales (1,000s of gallons)
1 17
2 21
3 16
4 24
5 17
6 18
7 22
8 20
9 21
10 19
11 16
12 25
(a) Show the exponential smoothing forecasts using α = 0.1, and α = 0.2.
Exponential
Smoothing
Week α = 0.1 α = 0.2
13
(b) Applying the MSE measure of forecast accuracy, would you prefer a smoothing constant of α = 0.1 or α = 0.2 for the gasoline sales time series?
An - Select your answer -α = 0.1α = 0.2Item 3 smoothing constant provides the more accurate forecast, with an overall MSE of  .
(c) Are the results the same if you apply MAE as the measure of accuracy?
An - Select your answer -α = 0.1α = 0.2Item 5 smoothing constant provides the more accurate forecast, with an overall MAE of  .
(d) What are the results if MAPE is used?
An - Select your answer -α = 0.1α = 0.2Item 7 smoothing constant provides the more accurate forecast, with an overall MAPE of  .

In: Statistics and Probability

Consider the following gasoline sales time series. If needed, round your answers to two-decimal digits. Week...

Consider the following gasoline sales time series. If needed, round your answers to two-decimal digits.

Week Sales (1,000s of gallons)
1 17
2 21
3 19
4 23
5 18
6 16
7 20
8 18
9 22
10 20
11 15
12 22
(a) Show the exponential smoothing forecasts using α = 0.1, and α = 0.2.
Exponential
Smoothing
Week α = 0.1 α = 0.2
13
(b) Applying the MSE measure of forecast accuracy, would you prefer a smoothing constant of α = 0.1 or α = 0.2 for the gasoline sales time series?
An - Select your answer -α = 0.1α = 0.2Item 3 smoothing constant provides the more accurate forecast, with an overall MSE of  .
(c) Are the results the same if you apply MAE as the measure of accuracy?
An - Select your answer -α = 0.1α = 0.2Item 5 smoothing constant provides the more accurate forecast, with an overall MAE of  .
(d) What are the results if MAPE is used?
An - Select your answer -α = 0.1α = 0.2Item 7 smoothing constant provides the more accurate forecast, with an overall MAPE of  .

In: Statistics and Probability