Question 4

With the growing popularity of casual surf print clothing, two recent MBA graduates decided to broaden this casual surf concept to encompass a “surf lifestyle for the home.” With limited capital, they decided to focus on surf print table and floor lamps to accent people’s homes. They projected unit sales of these lamps to be 7,000 in the first year, with growth of 8 percent each year for the next five years. Production of these lamps will require GH¢35,000 in net working capital to start. Total fixed costs are GH¢ 95,000 per year, variable production costs are GH¢ 20 per unit, and the units are priced at GH¢48 each. The equipment needed to begin production will cost GH¢175,000. The equipment will be depreciated using the straight-line method over a five-year life and is not expected to have a salvage value. The effective tax rate is 34 percent, and the required rate of return is 25 percent. Evaluate the project using NPV.

1. Given the growing popularity of environmentally friendly clothing, two recent MBA graduates decided to broaden this casual surf concept to encompass a “green lifestyle for the home.” With limited capital, they decided to focus on environmentally friendly curtains to accent people’s homes. They projected unit sales of these curtains to be 5,000 per year. Production of these curtains will require $28,000 in net working capital to start. Variable production costs are $20 per unit, and the units are priced at $45 each. The equipment needed to begin production will cost $60,000. The equipment will be depreciated to zero using the straight-line method over a five-year life and is expected to have a salvage value of $5,000. The production will take place in an old warehouse that one of the graduates has inherited. He could have gotten it rented for $100,000 a year. The effective tax rate is 34%, and the required rate of return is 12%. (a) Compute the Payback period, NPV and IRR for this project. (b) How many curtains do you need to sell in order to make this project worthwhile?

You have recently graduated from college with an MBA. Upon graduation, you start working for Roosevelt Power Plant. The boss, Mr. Jones, invites you into his office. Mr. Jones describes to you a large fraud that has recently taken place in the company. He asks you what actions should be taken to ensure that fraud does not occur again. After analyzing the company, you compile a list of actions that will be needed to prevent fraud from occurring again. Upon presenting the necessary steps and controls to be taken, Mr. Jones notices your suggestion: "Create a culture of honesty and create a positive work environment for employees." Mr. Jones is enraged and wants to know what a positive work environment has to do with the prevention and detection of fraud. 1. What would you tell Mr. Jones about why a positive work environment will help prevent fraud? 2. What factors would you tell Mr. Jones contribute to a negative work environment?

MBA 5010 Week 3 Weekly Integrative Assignment

Copper and zinc work equally well as a chemical catalyst to mitigate pollution created in the production of lithium batteries. However, copper is currently 10% more expensive than zinc. And so, zinc is the current preferred material. The following diagrams represent the copper, zinc, and lithium battery markets.

However, some recent advances in pharmaceutical research have substantially increased demand for zinc in pharmaceutical manufacturing.

Using this example, explain how markets see to the most appropriate allocation of resources between competing uses. Limit your response to no more than 500 words. Be sure to include in your response the preceding diagrams, demonstrating the relevant change in each respective market. You may use Word drawing features or draw the diagrams, use your phone to capture them, and then insert them into your response. If you need help, ask. Your answer will be evaluated based on correctness, completeness, and clarity. Be attentive to your writing.

Blossom Corporation provides the following information about its defined benefit pension plan for the year 2020:

Blossom follows IRFS.

A polling organization collected data on a sample of 60 registered voters regarding a tax on the market value of equity transactions as one remedy for the budget deficit.

a. Compute gamma for the table.
b. Compute tau b or tau c for the same data.
c. What accounts for the differences?
d. Decide which is more suitable for these data.

Please answer all parts. Do not copy answers from other source. NEED FULL EXPLANATION. Please paste excel screenshot if you are using it.

1. (10) Evaluate each of the following statements – how does the situation affect the incentive to invest in a college degree? Why?

a. People who going into craft training programs such as carpentry or plumbing are making high wages.

b. A husband is planning to stay at home to raise his children.

c. Two siblings have entered college – one is a straight-A student with plenty of scholarships while the other maintained a 1.5 GPA in high school and must pay for most of their education out of pocket or through loans.

d. A college athlete receives a full scholarship to play hockey for the university he attends.

e. A 60-year old worker is deciding whether or not to pursue an MBA.

As you embark on your new career with “We Crunch the Numbers” you are confronted with a new problem, managing your own money. The firm has a 401(k) as well as money you want to invest outside your 401(k). You recently received a call from a former classmate who is a financial advisor. Your classmate guarantees to beat the S&P 500 for a fee of 1% of your total assets, annual. You took one financial class in your MBA and you are a strong believer in market efficiency. You also are aware that Vanguard has S&P 500 ETF that has an annual expense ratio of .03%. What is your decision?

Suppose marginal benefit from a hectare of for a public park (assume it is a pure public good) for two groups of consumers (A and B) is given by: MBa = 10 − Q and MBb = (8 – Q)/2 where Q is the number of hectares of the park. To simplify our analysis, assume that there are only 1 consumer of each type. The marginal cost to provide the park is a constant $5.

a) What is the socially efficient number of hectares for the park?

b) Assume that the consumers each makes a voluntary contribution to a fund which will be used to build the park. The size of the park depends on the amount of money collected. How many hectares will be built in the end? Assume both consumers know the marginal cost and marginal benefit function of each type.