ABC Company is currently operating at full capacity. It is considering buying a part from an outside supplier rather than making it in-house. If ABC purchases the part, it can use the released productive capacity to generate additional income of GH¢ 30,000 from producing a different product. When conducting incremental analysis in this make-or-buy decision, the company should:

Select one:

a. add GH¢ 30,000 to other costs in the “Make” column.

b. subtract GH¢ 30,000 from the other costs in the “Make” column.

c. add GH¢ 30,000 to other costs in the “Buy” column.

d. ignore the GH¢ 30,000.

ABC Company is considering a project with an annual cash flow of GH¢ 200,000. The project would have a seven year life, and the company uses a discount rate of 10 percent. (DF@ N=7, 10% = 4.868). What is the maximum amount the company could invest in the project and have the project still be acceptable?

Select one:

a. GH¢ 973,600.

b. GH¢ 200,000.

c. GH¢ 718,200.

d. GH¢ 1,400,000.

Last year, fixed manufacturing overhead costs were GH¢30,000, variable production costs were GH¢48,000, fixed selling and administration costs were GH¢20,000, and variable selling administrative expenses were GH¢9,600. There was no beginning inventory. During the year, 3,000 units were produced and 2,400 units were sold at a price of GH¢40 per unit. Under variable costing, what would be the operating income?

Select one:

a. A profit of GH¢ 4,000.

b. A loss of GH¢ 4,400.

c. A profit of GH¢ 6,000.

d. A loss of GH¢ 2,000.

During the last year, XYZ Company's total variable production costs were GH¢10,000, and its total fixed manufacturing overhead costs were GH¢6,800. The company produced 5,000 units during the year and sold 4,600 units. There were no units in the beginning inventory. Which of the following statements is true?

Select one:

a. The net income under absorption costing for the year will be GH¢544 higher than net income under variable costing.

b. The net income under absorption costing for the year will be GH¢800 lower than net income under variable costing.

c. The net income under absorption costing for the year will be GH¢544 lower than net income under variable costing.

d. The net income under absorption costing for the year will be GH¢800 higher than net income under variable costing.

A young connoisseur has $600 to spend to build a small wine cellar. She enjoys two vintages in particular: a 2001 French Bordeaux (F) at $40 per bottle and a less expensive 2005 California varietal wine (C) priced at $8 per bottle. Her utility is ?(?, ?) = ? 2/3? 1/3 . a. What is her expenditure function? b. What are the required expenditures to reach the maximized utility level under the original prices?

As a soon to be graduate, you are considering getting a master’s degree in your field before entering the workforce. Assuming the costs of getting a master’s degree in your field are $20,000 a year for each of the next two years, and that this advanced degree will increase your expected salary (versus that with just a bachelor’s degree) by $10,000 a year, calculate the NPV of this decision assuming your personal WACC is 8 percent and that you expect to work for 40 years before retirement.

When only two treatments are involved, ANOVA and the Student’s t test (Chapter 11) result in the same conclusions. Also, for computed test statistics, t^₂ = F. To demonstrate this relationship, use the following example. Fourteen randomly selected students enrolled in a history course were divided into two groups, one consisting of 6 students who took the course in the normal lecture format. The other group of 8 students took the course as a distance course format. At the end of the course, each group was examined with a 50-item test. The following is a list of the number correct for each of the two groups.

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1. a-1. Complete the ANOVA table. (Round your SS, MS, and Fvalues to 2 decimal places and p value to 4 decimal places.)

1. a-2. Use a α = 0.05 level of significance. (Round your answer to 2 decimal places.)

2. Using the t test from Chapter 11, compute t. (Negative amount should be indicated by a minus sign. Round your answer to 3 decimal places.)

3. There is any difference in the mean test scores.

Suppose μ₁ and μ₂ are true mean stopping distances at 50 mph for cars of a certain type equipped with two different types of braking systems. Use the two-sample t test at significance level 0.01 to test H₀: μ₁ − μ₂ = −10 versus H_a: μ₁ − μ₂ < −10 for the following data: m = 7, x = 114.5, s₁ = 5.06, n = 7, y = 129.9, and s₂ = 5.38.

Calculate the test statistic and determine the P-value. (Round your test statistic to two decimal places and your P-value to three decimal places.)

State the conclusion in the problem context.

Reject H₀. The data suggests that the difference between mean stopping distances is less than −10.

Reject H₀. The data does not suggest that the difference between mean stopping distances is less than −10.    

Fail to reject H₀. The data suggests that the difference between mean stopping distances is less than −10.

Fail to reject H₀. The data does not suggest that the difference between mean stopping distances is less than −10.

1. XXXXXXXXXXXXXXXXXXXA doctor from Cairo, Egypt is perplexed by two twin infants that he is treating for deficiencies in energy production.   He has many theories on what could be the issue, but he wants you to help. He presented their case to your lab. You sequence these infants DNA and try to uncover what metabolic problem they may have that is causing this energy-deficient illness they have.

1. (10 points) You characterize the enzymes for glycolysis, PDH, and TCA cycle and everything seems fine, except for one thing: you discover that these infants have a very strange pathway never discovered before. This pathway takes oxaloacetate from the body and branches it into a pathway that breaks it in down into seemingly non-biologically relevant intermediates. Why could this explain the energy deficiency the Egyptian doctor discovered? (50 words max).

ANSWER:

2. (10 points) You discover that the enzyme that controls this weird oxaloacetate pathway is very similar to Pyruvate Dehydrogenase. Additionally, this pathway can be regulated by reversible covalent modification very similar to that of PDH. These infants have a problem with this regulation, but if this regulation was normal, how could you regulate this weird pathway to solve their problem? Make sure you address ALL possible ways you can regulate, with the knowledge that this is very similar to PDH. (50 words max)

ANSWER:

3. (8 points) You also discover another problem in the infants: a key enzyme responsible for the production of Coenzyme Q (i.e. Ubiquinone) is hugely mutated to work very, very slowly.   This causes very low levels of Coenzyme Q in the infants. Why could this also explain their energy-production problem? (40 words max).

ANSWER:

4. (8 points) You email the doctor and he asks if it is possible to just add Coenzyme Q in the diet if the infant twins. Why may this work, in theory, but why might this be a problem to actually do in the body? Consider the structure of Coenzyme Q and where it is located in the mitochondria? (30 words max).

ANSWER:

A researcher has conducted a survey for Danone yogurt to understand what type of customers buy its products. Thus, in the survey, each respondent is asked if he is a Blue or White collar employee (that is if the respondents has an office job or not) and whether he buys the company’s yogurt or not. The results are shown in the following cross-tabulation table. Danone Yogurt Buyer Nonbuyer Total White Collar 152 8 160 Blue Collar 14 26 40 Total 166 34 200

a.) Using the table and your calculations, give a clear example of a cross-tabulation cell, column total, row total, grand total, observed frequency cell, expected frequency cell. (2 points)

b.) What is the maximum Chi-Square value you must have, for you to say that there is a statistically significant relationship between the two variables, with 95% accuracy? (1 point)

c.) Is there any relationship between the two variables, type of responder and buyer type? (3 points)

d.) What is the managerial insight you derive from this analysis? (2 points)

A) To determine if chocolate milk was as effective as other carbohydrate replacement drinks, nine male cyclists performed an intense workout followed by a drink and a rest period. At the end of the rest period, each cyclist performed an endurance trial where he exercised until exhausted and time to exhaustion was measured. Each cyclist completed the entire regimen on two different days. On one day the drink provided was chocolate milk and on the other day the drink provided was a carbohydrate replacement drink.

Data consistent with summary quantities appear in the table below. (Use a statistical computer package to calculate the P-value. Subtract the carbohydrate replacement times from the chocolate milk times. Round your test statistic to two decimal places, your df down to the nearest whole number, and the P-value to three decimal places.)

B) Some commercial airplanes recirculate approximately 50% of the cabin air in order to increase fuel efficiency. The researchers studied 1096 airline passengers, among which some traveled on airplanes that recirculated air and others traveled on planes that did not recirculate air. Of the 515 passengers who flew on planes that did not recirculate air, 104 reported post-flight respiratory symptoms, while 113 of the 581 passengers on planes that did recirculate air reported such symptoms. Is there sufficient evidence to conclude that the proportion of passengers with post-flight respiratory symptoms differs for planes that do and do not recirculate air? Test the appropriate hypotheses using α = 0.05. You may assume that it is reasonable to regard these two samples as being independently selected and as representative of the two populations of interest. (Use a statistical computer package to calculate the P-value. Use p_{do not recirculate} − p_{do recirculate}. Round your test statistic to two decimal places and your P-value to four decimal places.)

1. Match the correct term to the following statement.

Cost equals :

cost minus markdown.

markdown minus markup.

net profit minus operating expenses.

selling price minus markup.

cost minus markup.

2.

Use the basic equations to determine the selling price in the following problem. Round your answer to the nearest cent.

3.

Use the basic equations to determine the markup amount in the following problem. Round your answer to the nearest cent.

4.

Complete the following problem. Round your answer to the nearest cent.

If the selling price is $32.99 and the cost is $16.00, the markup is $ =

5.

Complete the following problem. Round your answer to the nearest cent.

If the markup is $22.00 and the cost is $15.50, the selling price is $ =

6.  Match the correct term to the following statement.

________  Incurred by a business, such as rent and utilities

Select =

cost

markdown

markup

net profit

operating expenses

selling price

7.

Use the basic equations to determine the markup amount in the following problem. Round your answer to the nearest cent.

8.  

Match the correct term to the following statement.

___________ Amount manufacturer charges for merchandise.

select=

cost

markdown

markup

net profit

operating expenses

selling price

9.

Use the basic equations to determine the cost in the following problem. Round your answer to the nearest cent.

10.  Match the correct term to the following statement.

Selling Price equals =

cost plus markdown

markdown plus markup

net profit plus operating expenses

selling price plus operating expenses

cost plus markup

MountainHigh  has selected a capital structure D/A = 0.75. Once the firm selects its target capital structure it envisions two possible scenarios for its operations: Feast or Famine. The Feast scenario has a 50 percent probability of occurring and forecast EBIT in this state is $60,000. The Famine state has a 50 percent chance of occurring and the EBIT is expected to be $20,000. Further, the debt cost will be 12 percent. The firm will have $400,000 in total assets, it will face a 40 percent marginal tax rate, and the book value of equity per share under either scenario is $10.00 per share.

What is the coefficient of variation of expected EPS under the capital structure plan?