You are a pension fund manager looking for an investment that will provide a reliable stream of income over the next 5 years. You want to find the best yield possible while still conforming to the pension fund covenant of investing in investment grade bonds or better. Decide among the following investment options for your fund.

a. Eastern Telecommunications Inc.: 5 years, 10% yield, EBIT Interest Coverage ratio = 4.4, EBITDA interest coverage ratio = 5.8, total debt of $72,625,000 (all of which is long term), total equity of $175,000,000, and a return on equity (ROE) of 7.9%.

b. Anderson Nuclear Power: 5 years, 15% yield, EBIT Interest Coverage ratio = 0.75, EBITDA interest coverage ratio = 0.9, total debt of $48,000,000, total equity of $70,000,000, and a return on capital (ROE) of 7.8%.

c. Titan Tech Company: 5 years, 6% yield, EBIT Interest Coverage ratio = 24.1, EBITDA interest coverage ratio = 30.5, total debt of $90,000,000 (all of which is long term), total equity of $1,500,000,000, and a return on equity (ROE) of 19.9%.

The following table shows the three-year median ratios for U.S. Industrials with long-term debt. Use the table to discuss the pros and cons of each investment option, described above. Determine the grade of each bond (as closely as you can). Which bond is appropriate for your pension fund?

Answer:

a. Eastern Telecommunications Inc.:

b. Anderson Nuclear Power:

c. Titan Tech Company

d. Summary recommendation:

1,) J.W. is a 25-year old female. She is currently pregnant in her first trimester and has been suffering from hyperemesis gravidarum. Because of this, she is struggling to stay hydrated and nourished. She is 5’4” and her pre-pregnancy weight was 155 lb. Now, at 10 weeks pregnant, she is 138 lb. Her Obstetrician is very concern and refers her to you for nutrition advice. What are you recommendations?
Key topics to cover: % weight loss, % UBW, risk of malnutrition, nutrition management of hyperemesis gravidarum, calorie and protein target, ideal weight gain throughout remainder of pregnancy. Please be specific.

2.)  Three weeks after your visit with J.W., she is continuing to lose weight and still struggling to keep any food down. Her weight is now 135 lb. Her Obstetrician feels she would really benefit from tube feedings. He has selected the tube feeding formula Osmolite 1.0 (which is 1 kcal/mL tube feeding formula). Describe the tube feeding regimen you would recommend.
Key topics to cover type of tube, type of infusion (continuous, intermittent, bolus), daily kcal needed, goal rate of tube feeding, clinical outcomes to monitor.

3.) With much credit to your nutrition recommendations, J.W. had a safe and healthy pregnancy and delivered a healthy baby girl, G.W. Fast-forward 5 years later and J.W. is at the Pediatrician’s office because she is concerned that G.W. is a very picky eater. She is worried that G.W. is underweight because of her picky eating. She is 30 lb, 40 inches. Plot her weight-for-age, stature-for-age, and BMI-for-age (see attached) on each growth curve. Describe your findings.
Key topics to cover: What is G.W.’s percentile for each growth curve? Is she underweight, normal weight, overweight, obese? About how many calories does she need? What are some general nutrition tips you have for J.W. and G.W.?

PLEASE ANS ALL THE SUB-QUESTIONS.

Suppose an electric utility is considering whether to install a wind farm with 30 megawatts (mw) of capacity or a natural gas generator that would produce the same amount of annual electricity. An engineering study showed that the site for the wind farm would produce a load factor of 25 percent. (Actual generation would be 25 percent of capacity on average over the course of a year.) The natural gas plant could be operated with a load factor of 50 percent. Capital costs for the wind farm would $1.5 million per megawatt, compared to $1.0 million per megawatt for the natural gas plant. Operating costs for both plants would be $2 million per year excluding fuel costs.

a. If the gas plant has a thermal efficiency of 0.4 (that is, 40 percent of the energy in the fuel gets converted to electric energy), and the cost of natural gas is $5 per million Btu, how much natural gas would be needed, and what would be the annual fuel cost for the gas plant? Show your calculations, including the assumptions you make about converting Btus to mwh.

b. What would be the levelized cost of electricity per mwh from the wind farm and from the natural gas plant, assuming a 10 percent annual interest rate and that both facilities have a 25 year life? Explain your calculations. Which is the least cost source of electricity?

c. The electric utility is investor-owned and subject to rate of return regulation. The capital costs are allowed in the rate base, but not operating or fuel costs. If the regulatory agency allows the firm to earn a 10 percent return on the rate base, what would be the regulated price of electricity with each type of generation? Which source would the utility prefer? Explain how you derived your answer.

d. If the electric utility has to pay an emission fee of $25 per metric ton of carbon dioxide emitted from fuel consumption, what would be the effect on the levelized cost of power and the regulated price? Use the emission factors for natural gas combustion on the EIA's website to derive your answer.

Assume that you recently graduated from ADU’s MHA program and landed a job as an assistant financial officer with the Cleveland Clinic. The clinic has $100,000 sitting in a checking account. The funds were designated by the board for the construction of a proton therapy facility. Construction of the facility will start one year from now. Your first assignment is to invest the $100,000 with the understanding that you need to plan for a one-year holding period because the funds must be available when construction begins in one year. Further, your boss has restricted you to the following investment alternatives, shown with their probabilities and associated outcomes.                 

Barney Smith Investment Advisors recently issued estimates for the state of the economy and the rate of return on each state of the economy. Alta Industries, Inc. is an electronics firm; Repo Men Inc. collects past due debts; and American Foam manufactures mattresses and various other foam products. Barney Smith also maintains an "index fund" which owns a market-weighted fraction of all publicly traded stocks; you can invest in that fund and thus obtain average stock market results. Given the situation as described, answer the following questions.                  

a. Calculate the expected rate of return on each alternative.

b. Calculate the standard deviation of returns on each alternative.

c. Calculate the coefficient of variation on each alternative.

d. Calculate the beta on each alternative.

g. Suppose you create a two-stock portfolio by investing $50,000 in Alta Industries and $50,000 in Repo    Men. Calculate the expected return, standard deviation, coefficient of variation, and beta for this    portfolio. How does the risk of this two-stock portfolio compare with the risk of the individual stocks if they were held in isolation?

SPD Tax Service is a regional tax preparation firm that competes with such national chains as H&R Block. The company is considering expanding and needs a financial model to analyze the decision to open a new store. Key factors affecting this decision include the demographics of the proposed location, price points that can be achieved in the target market, and the availability of funds for marketing and advertising. Capital expenditures will be ignored because unused equipment from other locations can often be shifted to a new store for the first year until they can be replaced periodically through the fixed cost budget. SPD’s target markets being considered are communities with populations between 30,000 and 50,000, assumed to be uniformly distributed. Market demand for tax preparation service is directly related to the number of households in the territory; approximately 15% of households are anticipated to use a tax preparation service. Assuming an average of 2.5 people per household, this can be expressed as 0.15*population/2.5. SPD estimates that its first year demand will have a mean of 5% of the total market demand, and for every dollar of advertising, the mean increases by 2%. The first year demand is assumed to be normal with a standard deviation of 20% of the mean demand. An advertising budget of $5,000 has been approved but is limited to 10% of annual revenues. Demand grows fairly aggressively in the second and third year and is assumed to have a triangular distribution with a minimum value of 20%, most likely value of 35%, and maximum value of 40%. After year 3, demand growth is between 5% and 15%, with a most likely value of 7%. The average charge for each tax return is $175, and increases at a rate that is normally distributed with a mean of 4% with a standard deviation of 1.0% each year. Variable costs average $15 per customer, and increase annually at a rate that is normally distributed with a mean of 3% with a standard deviation of 1.5%. Fixed costs are estimated to be approximately $35,000 for the first year, and grow annually at a rate between 1.5% and 3%. Develop a Monte Carlo simulation model to find the distribution of the net present value of the profitability of a new store over a 5-year period using a discount rate of 5%.

Siegel Company manufactures a product that is available in both a deluxe model and a regular model. The company has manufactured the regular model for years. The deluxe model was introduced several years ago to tap a new segment of the market. Since introduction of the deluxe model, the company’s profits have steadily declined and management has become increasingly concerned about the accuracy of its costing system. Sales of the deluxe model have been increasing rapidly.

Manufacturing overhead is assigned to products on the basis of direct labor-hours. For the current year, the company has estimated that it will incur $6,665,100 in manufacturing overhead cost and produce 17,000 units of the deluxe model and 115,000 units of the regular model. The deluxe model requires 1.0 hours of direct labor time per unit, and the regular model requires 0.5 hour. Material and labor costs per unit are as follows:

Determine the predetermined overhead rate for each of the four activity cost pools.

3. Using the predetermined overhead rates you computed in part (2), do the following:

a. Compute the total amount of manufacturing overhead cost that would be applied to each model using the activity-based absorption costing system. After these totals have been computed, determine the amount of manufacturing overhead cost per unit of each model.

b. Compute the unit product cost of each model (direct materials, direct labor, and manufacturing overhead).

Allocating Joint Costs Using the Weighted Average Method

Orchard Fresh, Inc., purchases apples from local orchards and sorts them into four categories. Grade A are large blemish-free apples that can be sold to gourmet fruit sellers. Grade B apples are smaller and may be slightly out of proportion. These are packed in boxes and sold to grocery stores. Apples for slices are even smaller than Grade B apples and have blemishes. Apples for applesauce are of lower grade than apples for slices, yet still suitable for canning.

Information on a recent purchase of 20,000 pounds of apples is as follows: Assume that Orchard Fresh, Inc., uses the weighted average method of joint cost allocation and has assigned the following weights to the four grades of apples:

Total joint cost is $19,000.

Required:

1. Allocate the joint cost to the four grades of apples using the weighted average method. Round your allocation percentages to four decimal places and round the allocated costs to the nearest dollar.

(Note: The joint cost allocation does not equal $19,000 due to rounding.)

2. What if the factory found that Grade A apples were being valued less by customers and decided to decrease the weight factor for Grade A apples to 3.0? How would that affect the allocation of cost to Grade A apples? How would it affect the allocation of cost to the remaining grades? Round your allocation percentages to four decimal places and round the allocated costs to the nearest dollar.

(Note: The joint cost allocation does not equal $19,000 due to rounding.)

1. You want to study the relationship between fat intake (g/day) and the death rate in the Central Valley. Your friend, from PH 109, suggests that you conduct an ecological study first. You found the data and summarized it below. What is the association between fat intake (g/day) and death rate? Explain the ecological fallacy. Please show your scatter plot. (3 points)

2. In order to study the relationship between alcohol intake (high or low) and liver cancer, 2,345 persons with incident liver cancer were identified through cancer registries. 3,246 people without liver cancer, selected from the DMV registries were also included in this study. Alcohol intake data was collected through mailed questionnaires. 825 of the people with liver cancer and 855 of those without liver cancer reported high alcohol intake, while the others reported low alcohol intake.

1. Calculate and interpret the appropriate measure of association for the alcohol intake level and liver cancer association. Fill in the table below. (3 points)

2) A matched case-control study was carried out to assess the possible association between high-fat diet and colon cancer. The data are presented below.

Total = 400 matched pairs

1. Calculate the appropriate measure of association taking matching into account. (2 points)

b.   Construct an unmatched 2 х 2 table. Calculate the OR without taking the matching into account. (2 points)

1) In an air-standard Brayton cycle, the air enters the compressor at 0.1 MPa and 15?C. The pressure leaving the compressor is 1.0 MPa, and the maximum temperature in the cycle is 1100?C. Determine The pressure and temperature at each point in the cycle. The compressor work, turbine work, and cycle efficiency. For each control volume analysed, the model is ideal gas with constant specific heat at 300 K, and each process is steady state with no kinetic or potential energy changes.

2) A utility runs a Rankine cycle with a water boiler at 3MPa, and the highest and lowest temperatures of the cycle are 450?C and 45?C, respectively. Find the plant efficiency and the efficiency of a Carnot cycle with the same temperatures.

3) A single stage air compressor running at 80 RPM, compress air from a pressure of 1 bar and temperature of 15oC to a pressure of 5 bar. The clearance volume is 5 % of swept volume which is 0.42 m3 . Assuming that the compression and expansion to follow the law, PV(1.3)= constant. Determine volumetric efficiency, mass of air delivered in kg/sec, exit temperature of air and the power required to drive the compressor in KW.

4) The velocity of steam at inlet to a simple impulse turbine is 1000 m/s, and the nozzle angle is 20o. The blade speed is 400 m/s and the blades are symmetrical. Determine the blade angle if the steam is to enter the blade without shock. If the relative velocity at exit is reduced by friction to 80% of that at inlet, what are then the diagram power and the axial thrust for a mass flow of 0.75 kg/s? Calculate also the diagram efficiency in this case.

5) The nozzle of the impulse stage of a turbine receives steam at 15 bar and 300oC and discharges at 10 bar. The nozzle efficiency is 95% and the nozzle angle is 20 o . The blade speed is that required for maximum work and the inlet angle of the blades is that required for entry of the steam without shock. The blade exit angle is 5o less than the inlet angle. The blade velocity coefficient is 0.9. Calculate for a steam flow of 1350 kg/h: The diagram power; The diagram efficiency.

Siegel Company manufactures a product that is available in both a deluxe model and a regular model. The company has manufactured the regular model for years. The deluxe model was introduced several years ago to tap a new segment of the market. Since introduction of the deluxe model, the company’s profits have steadily declined and management has become increasingly concerned about the accuracy of its costing system. Sales of the deluxe model have been increasing rapidly.

Manufacturing overhead is assigned to products on the basis of direct labor-hours. For the current year, the company has estimated that it will incur $5,374,500 in manufacturing overhead cost and produce 12,000 units of the deluxe model and 111,000 units of the regular model. The deluxe model requires 1.0 hours of direct labor time per unit, and the regular model requires 0.5 hour. Material and labor costs per unit are as follows:

Determine the predetermined overhead rate for each of the four activity cost pools.

3. Using the predetermined overhead rates you computed in part (2), do the following:

a. Compute the total amount of manufacturing overhead cost that would be applied to each model using the activity-based absorption costing system. After these totals have been computed, determine the amount of manufacturing overhead cost per unit of each model.

b. Compute the unit product cost of each model (direct materials, direct labor, and manufacturing overhead).