The average life a manufacturer's blender is 5 years, with a standard deviation of 1 year. Assuming that the lives of these blenders follow approximately a normal distribution, find the probability that the mean life a random sample of 9 such blenders falls between 4.5 and 5.1 years.
The answer is 0.5511
In: Statistics and Probability
Draw a graph showing the present value of a $1000 payment made 10 year in the future on the y-axis, and discount rate on the x-axis.
In: Economics
| 12. | Below is a table detailing the number of days of personal travel over a year paired with annual household income (in 1000's of dollars) for 9 various families. | |||||||||
| HH Income ($000's) | Travel Days | |||||||||
| 61 | 11 | |||||||||
| 32 | 6 | |||||||||
| 45 | 13 | |||||||||
| 35 | 9 | |||||||||
| 22 | 3 | |||||||||
| 89 | 21 | |||||||||
| 30 | 8 | |||||||||
| 74 | 15 | |||||||||
| 37 | 9 | |||||||||
| a. | Construct a scatterplot for this data set in the region to the right (with household income as the independent variable, and travel days as the dependent variable.) | |||||||||
| b. | Based on the scatterplot, does it look like a linear regression model is appropriate for this data? Why or why not? | |||||||||
| c. | Add the line of best fit (trend line/linear regression line) to your scatterplot. Give the equation of the trend line below. Then, give the slope value of the line and explain its meaning to this context. | |||||||||
| d. | Determine the value of the correlation coefficient. Explain what this value tells you about the two variables? | |||||||||
| e. | Based on the linear regression equation, what is the predicted number of personal travel days a person will take annually if their household income is $85,000? Show your calculation. | |||||||||
In: Statistics and Probability
The owner of a bicycle repair shop forecasts revenues of $180,000 a year. Variable costs will be $55,000 and rental costs for the shop are $35000 a year. Depreciation on the repair tools will be $15000
a. Prepare an income statement for the shop based on these estimates. The tax rate is 20%
b. Calculate the Operating cash flow for the repair shop using three methods given below
dollars in minus dollars out
adjusted accounting profits
add back depreciation tax shield
In: Finance
In: Accounting
The total factory overhead for Bardot Marine Company is budgeted for the year at $816,000, divided into two departments: Fabrication, $648,000, and Assembly, $168,000. Bardot Marine manufactures two types of boats: speedboats and bass boats. The speedboats require four direct labor hours in Fabrication and three direct labor hours in Assembly. The bass boats require two direct labor hours in Fabrication and three direct labor hours in Assembly. Each product is budgeted for 4,000 units of production for the year.
If required, round all per unit answers to the nearest cent.
a. Determine the total number of budgeted direct labor hours for the year in each department.
| Fabrication | direct labor hours |
| Assembly | direct labor hours |
b. Determine the departmental factory overhead rates for both departments.
| Fabrication | $ per dlh |
| Assembly | $ per dlh |
c. Determine the factory overhead allocated per unit for each product using the department factory overhead allocation rates.
| Speedboat: | $ per unit |
| Bass boat: | $ per unit |
In: Accounting
PPG is expected to earn $4 per share in one year. The market demand for the new product is expected to be high so PPG decides to retain 60% of its earnings in year 1, 2, and 3. The reinvestments are expected to generate 10% return. Starting from year 4, PPG will maintain an 60% dividend payout rate because the investment return is expected to decline to 5% due to increased competition from similar products. (round to two decimal places for all the answers)
a. What is the earnings growth rate for year 1 to 2, year 2 to 3, and year 3 to 4?
b. What is the long term growth rate after year 4?
c. Calculate the earnings per share for year 1, 2, 3, 4, and 5.
d. Calculate the dividend per share for year 1, 2, 3, 4, and 5.
e. If the cost of equity capital is 4%, find the current share price. f. PPG manager decides to try alternative valuation method based on multiples from the industry peers. The average forward P/E ratio (i.e., price divided by earnings in the coming year) of the same industry is 30. What is should be the per share price of PPG based on the P/E ratio?
In: Finance
In the first 5 months of this year, the Mustang Fund recorded the monthly returns set out in column (2) below. The Mustang Fund was tracking the ASX 200 market index, the monthly performance of which is set out in column (3).
Month, 2020 Mustang Fund return (%) ASX 200 return (%)
(1) (2) (3)
January 6.6 5.0
February -8.9 -8.2
March -22.3 -21.2
April 7.3 8.8
May 1.8 1.2
1 + 1 + 1 = 3 marks
i) Calculate the monthly average tracking performance of the Fund.
ii) Calculate the monthly average absolute tracking performance of the Fund.
iii) Explain and compare your answers in parts i. and ii. above
In: Accounting
. You buy a 13%, 7-year bond with a yield to maturity of 10.5%. What is the price on this bond? Two years later, the yield to maturity on the bond is 9%. What is the price of the bond at this time? Calculate your percentage return on this bond if you sell at this time.
.
In: Finance
In the current year, the DOE LLC received revenues of $300,000 and paid the following amounts: $50,000 of business expenses (rent, utilities, wages, depreciation, etc.), a $50,000 guaranteed payment (for services) to 50% member Dave, $20,000 to member Ethan for consulting services, and $10,000 as a distribution to member Olivia. In addition, the LLC earned $4,000 of tax-exempt interest income during the year. Dave is the managing member of the LLC. Dave’s basis in his LLC interest was $50,000 at the beginning of the year and includes a $15,000 share of LLC liabilities. At the end of the year, his share of the LLC’s liabilities was $25,000.
In: Accounting