AnyCo is a US consumer product company enjoying broad distribution and dominant market share in its domestic market. An opportunity exists to penetrate and perhaps dominate an offshore market, PseudoLand, worth an estimated $20 million in sales per year. Domestically, however, each dollar of revenue consistently produces the following income statement (P/L):

Sales   $1.00

    Delivered Cost of Goods      .55

   Gross Profit   $ .45

   Selling Expns      .06

   General & Admin Expns       .30

   Operating Profit   $ .09

AnyCo has already begun exporting to PseudoLand and, as expected, commissions (selling expenses) are higher overseas. AnyCo’s board of directors is committed to maintaining the company’s current capital costs, and is attracted to this opportunity because it returns nearly the same operating profit (as a % of sales) as its current business in the US. However, the company’s managers want to diversify the offshore distribution strategy in order to maximize penetration. Three modes of distribution have been identified:

1. An export company has taken charge of the effort to date, but this arrangement is not exclusive.

2. Selling directly to PseudoLand consumers over the internet

3. Using a local distribution company to sell products in PseudoLand

Through research, Anyco has come to believe that the current export company can, at best, effect 50% penetration of the PseudoLand marketplace. The internet could add an additional 20%. A local distribution company would be a bit more powerful, capturing as much as 30%. Selling expenses are 7% for the export company and 4% over the internet. However, the local distributor has balked at Anyco’s standard 6% commission, and is demanding 10%. Negotiations with the local distributor look inevitable.

Determine the best alternative to a negotiated agreement (BATNA) and a reservation sales commission above which, the company would walk away without an agreement. Using not more than one typed page (single spaced) and one spread sheet, explain your findings.

* Please elaborate reasoning!

an us company has two manufacturing plants one in UAE and one in another country. Both produce the same items,eath for sale in their perspectives countries. However their productivity figures are quite different. The analyst thinks this is because the UAE plan uses more automated equipment for processing while the other uses a high percentage for labor.
1-explain how that factor can cause productivity figures to be misleading.
2-Is there another way to compare the two plants that would be more meaningful?

Consider the following rates of return: Year / Large Company Stocks / US Treasury Bill 1 3.99 % 4.59 % 2 14.16 4.94 3 19.25 3.86 4 –14.43 6.99 5 –31.92 5.30 6 37.49 6.20 a. Calculate the arithmetic average returns for large-company stocks and T-bills over this period. b. Calculate the standard deviation of the returns for large-company stocks and T-bills over this period. c-1 Calculate the observed risk premium in each year for the large-company stocks versus the T-bills. What was the arithmetic average risk premium over this period? c-2 Calculate the observed risk premium in each year for the large-company stocks versus the T-bills. What was the standard deviation of the risk premium over this period?

Use the following information to answer the next four questions.

Your business (US company) will receive a payment of 150,000 British pounds. You have decided to fully hedge your company’s foreign exchange risk with futures contracts. Each futures contract for British pounds has an initial margin of $1500 and a maintenance margin of $1100. Each futures contract has 25,000 British pounds attached. You open your position on 11/30/2018 when the futures price was $1.955 per pound. The table below shows the futures prices for the three days immediately after you opened your position.

1) Find your initial margin balance on the day you opened your position.

2) Find your ending margin balance on 12/1. Assume any deficits are eliminated to keep the position open and any excesses remain in the account.

3) Find your ending margin balance (in dollars) on 12/3.  Assume deficits are eliminated to keep the position open and excesses remain in the account. Do not use currency symbols or words when entering your response.

4) Find the total amount of variation margin that occurred from 11/30-12/3.

US Auto Company would like to offer rebates to its customers in order to increase sales. If it lowers prices sales will increase.    This will depend on the price elasticity of demand. Assume that the price elasticity of demand is 1.5. This firm is considering a $400 rebate on its cars. Also assume the following information on prices and costs before the rebates:

          Average price per car                                   $9,000 per car

          Expected sales volume at $9,000) per car     1,000,000 cars

          Average total costs per car                           $8,200 per car

          Total variable cost                                         $6,400,000,000

• Calculate the present total fixed costs, average variable costs and average fixed costs.
• What is the present breakeven point?
• What is the change in revenue resulting from the $400 price reduction?
• What is the effect on the cost per car after the change? In other words what is the average cost per car after the change?
• Should the change be made?

Please show the calculation. Thank you.

In the US, people die because they do not have private health insurance or their insurance does not cover the treatments they need. A 2009 Harvard study published in the American Journal of Public Health found more than 44,800 excess deaths annually in the United States due to Americans lacking health insurance, equivalent to one excess death every 12 minutes. More broadly, the total number of people in the United States, whether insured or uninsured, who die because of lack of medical care was estimated in a 1997 analysis to be nearly 100,000 per year.

Prepare your thoughtful and informed response to this statement.

1. NewCo grants 10,000 options to its CFO, with a grant date of January 15, 2018.  The options grant the CFO the right to purchase shares (one-for-one) of company stock at a price of $.50 per share.  
   1. When NewCo grants the options, what will change on its balance sheet?

2. When the CFO exercises the options
   1. where will the 10,000 shares come from? (Who is selling the shares to the CFO?)

2. What will change on NewCo’s balance sheet?

XYZ plans to re-structure its capital due to the demand of some shareholders who would with draw their shares from company’s equities. To maintain a level of total assets, the company should either increase long-term debts or issue common shares to other shareholders (could be through private placement or initial public offering).Explain how does XYZ re-structure its capital ( Using 2 theories of capital structure)