An investigator analyzed the leading digits from 787 checks issued by seven suspect companies. The frequencies were found to be 4​, 11​, 2​, 72​, 371​, 281​, 7​, 16​, and 23​, and those digits correspond to the leading digits of​ 1, 2,​ 3, 4,​ 5, 6,​ 7, 8, and​ 9, respectively. If the observed frequencies are substantially different from the frequencies expected with​ Benford's law shown​ below, the check amounts appear to result from fraud. Use a 0.025 significance level to test for​ goodness-of-fit with​ Benford's law. Does it appear that the checks are the result of​ fraud?

Leading Digit:      1    2    3 4 5 6    7 8 9
Actual Frequency:      4 11    2    72    371 281 7    16    23

Benford's Law:      30.1% 17.6% 12.5%    9.7%    7.9% ​ 6.7%    ​5.8% ​ 5.1%    ​4.6%

Determine the null and alternative hypotheses.

Ho​: (1)_________________    H1​: (2)_________________

Calculate the test​ statistic, χ2.

χ2 = _______________​

(Round to three decimal places as​ needed.)

Calculate the​ P-value.

P-value = _______________​

(Round to four decimal places as​ needed.)

The following table repeats the annual total returns on the MSCI Germany Index previously given and also gives the annual total returns on the JP Morgan Germany five- to seven-year government bond index (JPM 5–7 Year GBI, for short). During the period given in the table, the International Monetary Fund Germany Money Market Index (IMF Germany MMI, for short) had a mean annual total return of 4.33 percent. Use that information and the information in the table to answer the following questions.

a) Using the IMF Germany MMI as a proxy for the risk-free return, calculate the Sharpe ratio for:

(i) the 60/40 equity/bond portfolio described in Problem 12.

(ii) the MSCI Germany Index.

(iii) the JPM Germany 5–7 Year GBI.

b) Contrast the risk-adjusted performance of the 60/40 equity/bond portfolio, the MSCI Germany Index, and the JPM Germany 5–7 Year GBI, as measured by the Sharpe ratio.

Develop a marketing plan to increase ticket sales for each of these two shows as compared with the ticket sales from last year. With your target markets identified for The shows are the Wildcats and the Wonder Dogs. Similar to shows that did not do well on the Hush Puppies reunion concert that was intended to attract an audience of older adults, ages 50 to 60. The Center also failed to make as much as was anticipated on the Bouncing Bunnies family show that was targeted toward preschool and early elementary school students. The advertising campaigns for each show consisted primarily of print and radio ads as well as outdoor billboards. Describe the specific advertising, promotions, and marketing tools you will use to reach the target markets for each of these two shows and effectively increase tickets sales over last year’s results.

1. Describe the specific marketing strategies and marketing media you would use for each of these two shows. Explain your rationale and frequency for each.

2. Do the following for each show-

a. Design a print marketing advertisement.

b. Write a 30-second script to be used for a radio spot.

c. Design a creative social media promotion (that goes beyond just announcing the event).

3. Research current advertising rates and establish a marketing budget for each event.

1.

A monopolist has average cost AC = .2Q - 4 + 100/Q and marginal cost MC = .4Q - 4. Market demand is Q = 44 - P, implying that the firm’s marginal revenue is MR = 44 - 2Q. Its profit-maximizing output is

a. 92

b. 46

c. 40

d. 20

2.

Consider the same monopoly situation as in the previous question. The firm’s profit will be

a. 760

b. 660

c. 830

d. 380

Variance and standard deviation

Hull​ Consultants, a famous think tank in the​ Midwest, has provided probability estimates for the four potential economic states for the coming year. The probability of a boom economy is 13%​, the probability of a stable growth economy is 20​%, the probability of a stagnant economy is 54​%, and the probability of a recession is 13​%.

Calculate the variance and the standard deviation of the three​ investments: stock, corporate​ bond, and government bond. If the estimates for both the probabilities of the economy and the returns in each state of the economy are​ correct, which investment would you​ choose, considering both risk and​ return?  

​Hint: Make sure to round all intermediate calculations to at least seven​ (7) decimal places. The input​ instructions, phrases in parenthesis after each answer​ box, only apply for the answers you will type.

What is the variance of the stock​ investment?

%

​(Round to six decimal​ places.)

What is the standard deviation of the stock​ investment?

%

​(Round to two decimal​ places.)

What is the variance of the corporate bond​ investment?

%

​(Round to six decimal​ places.)

What is the standard deviation of the corporate bond​ investment?

%

​(Round to two decimal​ places.)

What is the variance of the government bond​ investment?

​%

​(Round to six decimal​ places.)

What is the standard deviation of the government bond​ investment?

%

​(Round to two decimal​ places.)

If the estimates for both the probabilities of the economy and the returns in each state of the economy are​ correct, which investment would you​ choose, considering both risk and​ return?  ​(Select the best​ response.)

A.

The corporate bond would be the best choice because it has the highest expected return and the lowest risk.

B.

The stock investment would be the best choice because it has the highest volatility and therefore the best chance of a high return.

C.

The government bond would be the best choice because it has the lowest risk.

D.

There is not enough information to make this decision.

Calculate the durations and volatilities of securities A, B, and C. Their cash flows are shown below. The interest rate is 10%. (Do not round intermediate calculations. Round "Duration" to 4 decimal places and "Volatility" to 2 decimal places.)

Calculate the durations and volatilities of securities A, B, and C. Their cash flows are shown below. The interest rate is 10%. (Do not round intermediate calculations. Round "Duration" to 4 decimal places and "Volatility" to 2 decimal places.)

Ten observations on the response variable y associated with two regressor variables x1 and x2 are given in the following table. The model fitted to these observations is yi = β 0 + β 1x1i + β 2x2i + εi , i = 1, …, n , (3) where ε’s are identically and independently distributed as a normal random variable with mean zero and a known variance σ ^2 = 3. Observation # y x1 x2 1 7 9 1 2 8 6 1 3 5 7 1 4 3 8 1 5 2 5 1 6 10 7 -1 7 9 6 -1 8 10 3 -1 9 9 4 -1 10 8 4 -1 a) Test the null hypothesis that there is no difference between the y-intercept for x2 = 1 and the y-intercept for x2 = -1 at a statistical significance level of 0.05. b) Now fit Model (4) to the 10 observations.

Hi all,

Please list all steps!!

Hayden Inc. has a number of copiers that were bought four years ago for $26,000. Currently maintenance costs $2,600 a year, but the maintenance agreement expires at the end of two years and thereafter the annual maintenance charge will rise to $8,600. The machines have a current resale value of $8,600, but at the end of year 2 their value will have fallen to $4,100. By the end of year 6 the machines will be valueless and would be scrapped.

Hayden is considering replacing the copiers with new machines that would do essentially the same job. These machines cost $31,000, and the company can take out an eight-year maintenance contract for $1,400 a year. The machines will have no value by the end of the eight years and will be scrapped.

Both machines are depreciated by using seven-year MACRS, and the tax rate is 40%. Assume for simplicity that the inflation rate is zero. The real cost of capital is 9%.

a. Calculate the equivalent annual cost, if the copiers are: (i) replaced now, (ii) replaced two years from now, or (iii) replaced six years from now. (Do not round intermediate calculations. Enter your answers as a positive value rounded to 2 decimal places.)

b. When should Hayden replace its copiers?

Perry plc is a large conglomerate company structured on a divisional basis. It seeks to maximise investor wealth. Head office avoids day to day involvement in divisional affairs and only intervenes if performance is considered unsatisfactory. Divisional performance is measured by residual income.

One of Perry’s larger divisions operates a chain of high-class hotels throughout the United Kingdom. The division’s mission statement is ‘To be the hotel of the first choice for business users and tourists’. Although the chain has generally been popular with tourists it is not proving quite so popular with business users and conference organisers. Competition in the top segment of the hotel market is fierce, with customers expecting the highest standards of facilities, service, and catering. Over the last two years, the division has invested a large amount of money in modernising its hotels including the improvement of bedrooms and public rooms, installation of gymnasia and swimming pools and the information technology features required by business travelers. A large amount of money has also been spent on staff training to improve service levels and on a television advertising campaign to promote improved hotels to business users.

Head office is concerned that the performance of the hotel chain appears to have declined over the last few years despite this expenditure.

         The following figures are available

The cost of capital applicable to the hotel division is 20% per annum

Required:

1. Calculate the residual income for the hotel chain for each of the three years.
2. Discuss three advantages and four disadvantages of residual income as a divisional performance measure.                                                                                                     ( 7 marks)