1. In class, we address the importance of maximizing shareholders’ wealth. However, it seems like maximizing stock prices does not make sense, because investors focus on short-term results and do not care about long-term consequences. What do you think? Please discuss.

2. In February, Cap Inc. announced that it would split into two independent publicly traded companies: one comprised of its Old Navy brand, and the second a yet-to-be-named company that includes its other brands like Banana Republic and Athleta. The planned breakup is an acknowledgment of the two chains' diverging fortunes and how much Gap has lost its once-powerful grip on American consumers. For several years, Old Navy has outperformed its sister brands Gap and Banana Republic with its lower price-points and catchy marketing. Old Navy now exceeds the original brand in sales, making up nearly half of Gap Inc.'s $16.6 billion of sales in 2018.

In your opinion, what are the benefits and downsides to splitting Gap into two firms? How did Gap's stock react to the news in after-market trading? How would you explain this reaction? Will the separation save the company in the long run? Please elaborate on your answers.

You invest $100 in a risky asset with an expected rate of return of 0.11 and a standard deviation of 0.20 and a T-bill with a rate of return of 0.03. What percentages of your money must be invested in the risk-free asset and the risky asset, respectively, to form a portfolio with a standard deviation of 0.08? Select one: a. 30% and 70% b. 50% and 50% c. 60% and 40% d. 40% and 60% e. Cannot be determined.

You invest $100 in a risky asset with an expected rate of return of 0.11 and a standard deviation of 0.20 and a T-bill with a rate of return of 0.03.

What percentages of your money must be invested in the risky asset and the risk-free asset, respectively, to form a portfolio with an expected return of 0.08?

Select one:

a. 85% and 15%

b. 75% and 25%

c. 62.5% and 37.5%

d. 57% and 43%

e. Cannot be determined.

AA corporation has a capital structure consisting of 40% debt, 10% preferred stock, and 50% common equity. Assume the firm has a sufficient retained earnings to fund the equity portion of its capital budget. It has 20-year, 14% semiannual coupon bonds that sell at their par value of $1,000. The firm could sell, at par, $50 preferred stock that pays a 8% annual dividend. AA’s beta is 1.4, the risk-free rate if 5%, and the market risk premium is 8%. AA is a constant growth firm that just paid dividend of $1.00, sells for $20.00 per share, and has a growth rate of 10%. AA’s tax rate is 30%. what is AA’s WACC?

i need specific calculation process for this question, not only the answer!!

A consulting firm has two departments, Corporate and Government. Computer support is common to both departments. The cost of computer support is $14.24 million. The following information is given:

Required:

What is the cost allocation if fixed computer costs of $10.23 million are allocated on the basis of number of consultants and the remaining costs (all variable) are allocated on the basis of the number of gigabytes of storage used by the department?

The following data for the dependent variable, y, and the independent variable, x, have been collected using simple random sampling:

1. Construct a scatter plot for these data. Based on the scatter plot, how would you describe the relationship between the two variables?
2. Compute the correlation coefficient.

A national chain of women’s clothing stores with locations in the large shopping malls thinks that it can do a better job of planning more renovations and expansions if it understands what variables impact sales. It plans a small pilot study on stores in 25 different mall locations. The data it collects consist of monthly sales, store size (sq. ft), number of linear feet of window display, number of competitors located in mall, size of the mall (sq. ft),and distance to nearest competitor (ft). USING EXCEL FUNCTIONS

1. Plot the residuals versus the actual values. Do you think that the model does a good job of predicting monthly sales? Why or why not?
2. Do you think that this model will be useful in helping the planners? Why or why not?
3. Test the individual regression coefficients. At the 0.05 level of significance, what are your conclusions?
4. If you were going to drop just one variable from the model, which one would you choose? Why?

1. A patient with deep vein thrombosis in his leg comes into the emergency room because the clot in his leg has broken free. To the dismay of the doctor, the clot, which began in the great saphenous vein of the leg, has now lodged in his kidneys. At first, the doctor is baffled as to how that could happen. However, looking at the patient’s medical records, she discovers that the patient has a history of heart problems. Specifically, the patient has suffered from valvular stenosis of the atrioventricular valves, as well as a foramen ovale that did not close completely at birth.
   1. Why was the doctor initially surprised to find the clot in the kidneys? What organ did she expect it to be in? (1 point)

2. Only one of the two heart conditions listed could explain how the clot got to the kidneys. Which one? (1 point)

3. Trace the path of the clot from the great saphenous vein to the interlobar artery of the kidney in detail, naming all the blood vessels/heart chambers along the way. You may find the last section of Chapter 20 helpful here. (7 points)

Molson currently sells 41 different brands of beer in Canada. Labatt currently sells 17 different brands. The manager at Mike's Place needs to choose 5 Molson brands and 5 Labatt brands to sell. How many options do they have? The 10 beers (5 Labatt, 5 Molson) selected in the previous question must be placed in a line on a display shelf so that no two Molson products are adjacent and no two Labatt products are adjacent. How many ways are there to do this? Continuing from the previous question, suppose two of the brands selected by the manager were (Labatt) 50 and (Molson) Export. The display shelf can not have a bottle of 50 adjacent to a bottle of Export. How many ways are there to do this while still avoiding two adjacent Molson products and two adjacent Labatt products? How many of the arrangements from the previous question have the bottle of 50 and the bottle of Export among the first (leftmost) 5 bottles?

Molson currently sells 41 different brands of beer in Canada. Labatt currently sells 17 different brands.

1. The manager at Mike's Place needs to choose 5 Molson brands and 5 Labatt brands to sell. How many options do they have?
2. The 10 beers (5 Labatt, 5 Molson) selected in the previous question must be placed in a line on a display shelf so that no two Molson products are adjacent and no two Labatt products are adjacent. How many ways are there to do this?
3. Continuing from the previous question, suppose two of the brands selected by the manager were (Labatt) 50 and (Molson) Export. The display shelf can not have a bottle of 50 adjacent to a bottle of Export. How many ways are there to do this while still avoiding two adjacent Molson products and two adjacent Labatt products?
4. How many of the arrangements from the previous question have the bottle of 50 and the bottle of Export among the first (leftmost) 5 bottles?

Bar Management

Molson currently sells 41 different brands of beer in Canada. Labatt currently sells 17 different brands.

1. The manager at Mike's Place needs to choose 5 Molson brands and 5 Labatt brands to sell. How many options do they have?
2. The 10 beers (5 Labatt, 5 Molson) selected in the previous question must be placed in a line on a display shelf so that no two Molson products are adjacent and no two Labatt products are adjacent. How many ways are there to do this?
3. Continuing from the previous question, suppose two of the brands selected by the manager were (Labatt) 50 and (Molson) Export. The display shelf can not have a bottle of 50 adjacent to a bottle of Export. How many ways are there to do this while still avoiding two adjacent Molson products and two adjacent Labatt products?
4. How many of the arrangements from the previous question have the bottle of 50 and the bottle of Export among the first (leftmost) 5 bottles?