Company A is opening a new branch in Charlotte today. Their unlevered cost of equity is 14%, and their cost of debt is 5%. Their debt to equity ratio is 1.1, and their tax rate is 26%. Initial costs are $1.5M. The firm expects EBIT of $1M one year from today, $500,000 two years from today, and $200,000 three years from today, after which they expect to shut down. They will finance some of their startup costs by borrowing $400,000 at their cost of debt, to be repaid three years from today.

What is Eyesore’s levered cost of equity?

What is the NPV of this project using the FTE method?

You’re finally ready to launch your first suite of services at your startup. You have no business or economic background and are unsure how to set the price. Your gut tells you to charge $700/year. Based on what we’ve learned in this course about the type of political and economic systems and price-setting strategies, explain how you would determine prices for your business. Be sure to mention the laws of supply and demand, the types of economic/political systems involved, and any key economic concepts involved. (one small paragraph in your own words)

During Phase 1, each individual will submit their own idea for an innovation along with a model they find useful for evaluating its merits. Each team member is responsible for completing research on various models. While there are several models in circulation for evaluating innovations, such as The Lean StartUp Plan, NOMMAR, SNIFF, and the linear and mental models of innovation, innovators should not feel constrained by any particular model. Feel free to borrow elements from multiple models to develop one that would work best to most effectively evaluate your own innovation.

I am doing lean start up .

Watch an episode of Shark Tank on the internet or on CNBC or on-demand through cable TV, and then choose ONLY ONE of the following scenarios below to prepare for this assignment:

• For one of the startups that received funding, what traits of that business made it attractive to the investor? Why?
• For one of the businesses that may or may not have received funding, what resources or capabilities were they looking for in the sharks, in addition to money? Why?
• For one of the businesses that did not receive funding, what was the fatal flaw that discouraged investors? Why?

Make certain that you state the name of the company or startup business that you selected in your assignment.

You open up a coffee shop, come up with a positive business plan.

Executive Summary and Company Background - Don't forget to explain which business model you chose and why, e.g., Sole Propritororship, LLC, etc.

Startup Costs / Operating Costs / Breakeven Point / Sales Forecast - You will need to explain how much money it will cost to start and run your business, and at what point you break even and begin to make money)

Marketing Plan / Marketing Mix - Explain the various ways you are going to market your business and why.

Recording and Reporting Equity Investment: FV-NI

Adjust FVA at Year-End

On November 1, 2020, Drucker Co. acquired the following investments in equity securities measured at FV‑NI.

Kelly Corporation—600 shares of common stock (no-par) at $60 per share. Keefe Corporation—360 shares preferred stock ($10 par) at $20 per share. On December 31, 2020, the company’s year-end, the quoted market prices were as follows: Kelly Corporation common stock, $52, and Keefe Corporation preferred stock, $24. Following are the data for 2021.

Mar. 2, 2021 Dividends per share, declared and paid: Kelly Corp., $1, and Keefe Corp., $0.50.
Oct. 1, 2021 Sold 120 shares of Keefe Corporation preferred stock at $25 per share.
Dec. 31, 2021 Fair values: Kelly common, $46 per share, Keefe preferred, $26 per share.

• Journal Entries and Financial Statement Presentation for 2020
• Journal Entries and Financial Statement Presentation for 2021

a. Prepare the entry for Drucker Company to record the purchase of the securities.

b. Prepare any adjusting entry needed at December 31, 2020.

c. Indicate the items and amounts that should be reported on the 2020 income statement of Drucker and its year-end balance sheet. Assume that the investments are classified as current.
Note: Use a negative sign to indicate a loss.

Feedback

You have correctly selected 13.

Partially correct

1) In? 2003, an organization surveyed

1 comma 5081,508

adult Americans and asked about a certain? war, "Do you believe the United States made the right or wrong decision to use military? force?" Of the

1 comma 5081,508

adult Americans? surveyed,

1 comma 0861,086

stated the United States made the right decision. In? 2008, the organization asked the same question of

1 comma 5081,508

adult Americans and found that

570570

believed the United States made the right decision. Construct and interpret a? 90% confidence interval for the difference between the two population? proportions,

p 2003 minus p 2008p2003?p2008.

The lower bound of a? 90% confidence interval is

nothing.

Two researchers conducted a study in which two groups of students were asked to answer 42 trivia questions from a board game. The students in group 1 were asked to spend 5 minutes thinking about what it would mean to be a? professor, while the students in group 2 were asked to think about soccer hooligans. These pretest thoughts are a form of priming. The

200200

students in group 1 had a mean score of

26.126.1

with a standard deviation of

4.84.8?,

while the

200200

students in group 2 had a mean score of

17.717.7

with a standard deviation of

3.93.9.

Complete parts ?(a) and ?(b) below.?(a) Determine the

9090?%

confidence interval for the difference in? scores,

mu 1 minus mu 2?1??2.

Interpret the interval.The lower bound is

nothing.

The upper bound is

nothing.

?(Round to three decimal places as? needed)

3)

?(a) Test whether

mu 1 not equals mu 2?1??2

at the

alpha equals 0.01?=0.01

level of significance for the given sample data.

Determine the null and alternative hypothesis for this test.

A.

Upper H 0 :H0:mu 1 equals mu 2?1=?2

Upper H 1 :H1:mu 1 greater than mu 2?1>?2

B.

Upper H 0 :H0:mu 1 equals mu 2?1=?2

Upper H 1 :H1:mu 1 not equals mu 2?1??2

Your answer is correct.

C.

Upper H 0 :H0:mu 1 not equals mu 2?1??2

Upper H 1 :H1:mu 1 equals mu 2?1=?2

D.

Upper H 0 :H0:mu 1 not equals mu 2?1??2

Upper H 1 :H1:mu 1 greater than mu 2?1>?2

Detemine the? P-value for this hypothesis test.

Pequals=nothing

?(Round to three decimal places as? needed.)

LOADING...

Click the icon to view the Student? t-distribution table.

?a) Perform a hypothesis test. Determine the null and alternative hypotheses.

A.

Upper H 0H0?:

mu 1 equals mu 2?1=?2?,

Upper H 1H1?:

mu 1 greater than mu 2?1>?2Your answer is correct.

B.

Upper H 0H0?:

mu 1 less than mu 2?1<?2?,

Upper H 1H1?:

mu 1 greater than mu 2?1>?2

C.

Upper H 0H0?:

mu 1 greater than mu 2?1>?2?,

Upper H 1H1?:

mu 1 less than mu 2?1<?2

D.

Upper H 0H0?:

mu 1 equals mu 2?1=?2?,

Upper H 1H1?:

mu 1 less than mu 2?1<?2

Determine the test statistic.

tequals=nothing

?(Round to two decimal places as? needed.)

LOADING...

Click the icon to view the Student? t-distribution table.

What are the null and alternative? hypotheses?

Upper H 0H0?:

mu Subscript carpet?carpet

equals=

mu Subscript no carpet?no carpet

versus Upper H 1H1?:

mu Subscript carpet?carpet

greater than>

mu Subscript no carpet?no carpet

Calculate the test? statistic,

t 0t0.

t 0t0equals=nothing

?(Round to two decimal places as? needed.)

CASE Warkworth Furniture

Warkworth Furniture specializes in environmentally friendly and sustainable furniture. One of its products, the TePaki desk, uses bamboo for the surface and recycled aluminum for the supports. The desk is made in its factory in Vietnam and shipped to all of its 30 stores throughout the United States, primarily in the large urban areas on either coast. Karen Williamson, the owner of Warkworth Furniture, is struggling with how it should organize its supply chain.

Currently, it ships the desks from Vietnam to the United States via ocean carrier. Once they arrive in the United States, they are shipped via a third-party carrier to each store. It usually takes 10 weeks between when an order is placed with the factory and when the product is received in a store.

The TePaki desk may be eco-friendly, but it isn’t wallet friendly: Each desk costs Warkworth $325 to make and it sells the desk for $850. Nevertheless, Warkworth has been able to identify a market segment of customers that value the look of the desk and what it represents. Across its stores, it sells six desks per week, or 0.2 desk per week per store.

Given the upscale nature of its business, Warkworth’s stores are located in nice areas that unfortunately have high rents. Consequently, between the opportunity cost of capital and the cost of physical space, Karen estimates that it costs Warkworth $150 to hold each TePaki desk in one of Page 483its stores for one year. It would be a financial disaster if each desk actually spent the entire year in inventory in a store, but the $150 does represent the true cost of holding a desk in a store for that period of time.

Shipping a TePaki desk from Vietnam to a store costs Warkworth $80 per desk, about $40 for the ocean portion of the journey and $40 for the land portion within the United States.

Andy Philpot, Warkworth’s director of operations, has been arguing for some time that Warkworth should set up a distribution center in southern California to receive products from Asia, and from there distribute them to its various stores. Warehouse space is much cheaper than prime retail space. Hence, the holding cost per TePaki desk per year in a warehouse would only be $60. The only problem with this approach, according to Andy, is that the total shipping cost from factory to store could increase by $8 per desk due to the extra handling and shipping distance once all of the desks are routed through a distribution center.

Karen understands why the distribution center approach could make sense, but she worries about getting all of the execution done right. Instead, she suggests that it ship all of the desks directly to the stores as it currently does, but then ship product between stores as needed. The only problem with that approach is that it probably will cost it about $40 per desk to ship from one store to another.

To add to the discussion, Kathy White, Warkworth’s marketing director, is concerned with how these ideas will affect the desks’ in-store availability. She proudly reminds everyone that Warkworth currently has a .99 in-stock probability for the TePaki desk. Andy, a typical ops guy, quips that it could save a ton if it were willing to make its customers wait a week or so to get their desk delivered to the store from a distribution center.

    1.How much does Warkworth incur in holding costs each year with its current system of delivering directly from the factory to its stores?

    2.Say Warkworth opens a distribution center in southern California. How much would it incur in holding costs each year with that strategy?

   3. Say Warkworth opens a distribution center in southern California. How much does it incur in holding costs per desk?

   4. Would you recommend that it consider Karen’s idea of holding all inventory at the stores but shipping between stores as needed?

   5. Say Warkworth listened to Andy and didn’t hold inventory at the stores. Instead, inventory would be held in a distribution center and shipped to the stores as needed. How much would it save in inventory holding costs with this strategy?

Subaru’s Sales Boom Thanks to the Weaker Yen

For the Japanese carmaker Subaru, a sharp fall in the value of the yen against the U.S. dollar has turned a problem—the lack of U.S. production—into an unexpected sales boom. Subaru, which is a niche player in the global auto industry, has long bucked the trend among its Japanese rivals of establishing significant manufacturing facilities in the North American market. Instead, the company has chosen to concentrate most of its manufacturing in Japan in order to achieve economies of scale at its home plants, exporting its production to the United States. Subaru still makes 80 percent of its vehicles at home, compared with 21 percent for Honda.

Back in 2012, this strategy was viewed as something of a liability. In those days, 1 U.S. dollar bought only 80 Japanese yen. The strong yen meant that Subaru cars were being priced out of the U.S. market. Japanese companies like Honda and Toyota, which had substantial production in the United States, gained business at Subaru’s expense. But from 2012 onward, with Japan mired in recession and consumer prices falling, the country’s central bank repeatedly cut interest rates in an attempt to stimulate the economy. As interest rates fell in Japan, investors moved money out of the country, selling yen and buying the U.S. dollar. They used those dollars to invest in U.S. stocks and bonds, where they anticipated a greater return. As a consequence, the price of yen in terms of dollars fell. By December 2015, 1 dollar bought 120 yen, representing a 50 percent fall in the value of the yen against the U.S. dollar since 2012.   

For Subaru, the depreciation in the value of the yen has given it a pricing advantage and driven a sales boom. Demand for Subaru cars in the United States has been so strong that the automaker has been struggling to keep up. The profits of Subaru’s parent company, Fuji Heavy Industries, have surged. In February 2015, Fuji announced that it would earn record operating profits of around ¥410 billion ($3.5 billion U.S.) for the financial year ending March 2015. Subaru’s profit margin has increased to 14.4 percent, compared with 5.6 percent for Honda, a company that is heavily dependent on U.S. production. The good times continued in 2015, with Subaru posting record profits in the quarter ending December 31, 2015.

Despite its current pricing advantage, Subaru is moving to increase its U.S. production. It plans to expand its sole plant in the United States, in Indiana, by March 2017, with a goal of making 310,000 a year, up from 200,000 currently. When asked why it is doing this, Subaru’s management notes that the yen will not stay weak against the dollar forever, and it is wise to expand local production as a hedge against future increases in the value of the yen. Indeed, when the Bank of Japan decided to set a key interest rate below zero in early February 2016, the yen started to appreciate against the U.S. dollar, presumably on expectations that negative interest rates would finally help stimulate Japan’s sluggish economy. By late March 2016, the yen had appreciated against the dollar and was trading at $1 = ¥112.

Question 1: As Subaru expands into different countries, we will face increased foreign currency risk. Discuss different modes of currency risk and how each should be managed.

Question 2: When evaluating which foreign markets to serve, Subaru must consider certain variables that influence the location-specific costs and benefits of serving those markets. Identify several of the most important variables to consider and the implications of each on potential profitability.

Question 3: As Subaru implements it international operations, we will need to consider to what degree we delegate decision making to our foreign subsidiaries. Explain several advantages and disadvantages of centralized versus decentralized decision making.

Question 4: What are some of the most important considerations we should evaluate to best configure our production and supply chain operations. Provide specific details for each consideration.

Question 5: Discuss political, economic and legal criteria to assess the attractiveness of doing business in different country-specific locations.   

CHOOSE ONE of the political parties to write on: either the Federalists OR theRepublicans.  Choose whichever party interests you, or choose a party that you don’t know much about. Once you choose your party, you will assume the role of a member from that party – pretend that you are either a Federalist or Republican from the 1790s.

write a minimum of three paragraphs discussing the political, economic, and diplomatic views of your political party . Your political views will include your perspective on state and national government (how strong or weak should they be); your economic views will include your perspective on economic directions that the nations should take (or not take); your diplomatic viewswill include your perspective on France and England (which nation do you support? why?). 
- If you are a Federalist, you will explain what the Alien and Sedition Acts are and give examples from the Acts that you think are necessary to support your position (ex: what parts of the Alien Acts are necessary for the survival of the United States?). 
-If you are a Republican, you will explain what theKentucky Resolutions are and give examples from the Resolutions that you think are necessary to support your position (ex: what role should states play when the national government oversteps its authority?).