Questions
(Please answer the question based on the movie "The Big Short.". Thank you.) 1.From the movie,...

(Please answer the question based on the movie "The Big Short.". Thank you.)

1.From the movie, what were the major reasons for the 2008 Great Recession?

2. One character specifically blamed a lot of the issues on “big banks”. Do you believe that the big banks are completely responsible for the near economic collapse? Why or why not?

3. What is something that you can personally take away from this movie?

4. What do you think might be the next issue in our economy (not related to COVID 19)?

5. Who was your favorite character and why?

In: Economics

-Suppose you are the owner of a large portfolio of long-term bonds in the health care...

-Suppose you are the owner of a large portfolio of long-term bonds in the health care industry and you believe that in the next three years, all healthcare will be socialized to the public sector. You anticipate that the profits of most healthcare companies will suffer immensely from this new path. If the market agrees with your assessment of the future, what would you anticipate would be the near term consequences for your bond portfolio? Why would this happen and why now, when the change to socialized medicine is three years away? How could you use options on these bonds to guard against lose?

In: Finance

Common terns hover in a stationary position over the ocean watching for a tasty fish. When...

Common terns hover in a stationary position over the ocean watching for a tasty fish. When they see one, they immediately stop their wings and simply free-fall into the ocean to catch the fish. Calculate how long a fish near the surface has to move away after the instant a tern sees it from a height of 3 m above the surface. Repeat Problem above, but now include air resistance. Assume a ball of 3 cm radius with an average density of 4400 kg/m 3 , a density of air of 1.3 kg/m 3 , and a value of C = 1.

In: Physics

Keynes wrote in The General Theory: “If we speak frankly, we have to admit that our...

Keynes wrote in The General Theory: “If we speak frankly, we have to admit that our basis of knowledge for estimating the yield ten years hence of a railway, a copper mine, a textile factory … amounts to little and sometimes to nothing”

Keynes was not talking about periods of turmoil and crisis when it might be expected that accurate information would be hard to come by; in his view, a state of “near ignorance” was the normal state of affairs.

Discuss Keynes’ concept of “uncertain” knowledge and what it may imply for our ability to measure risk and to invest, both in financial assets as well as in “real” businesses.

In: Economics

At the beach, some waves with wavelength of 100 m propagate towards the shore at a...

At the beach, some waves with wavelength of 100 m propagate towards the shore at a speed of 12.5 m/s. (c) Does the engine sound higher- or lower-pitched to someone standing on the shore, compared with the experience of people on the boat?

(a) Calculate the frequency that boat anchored near shore bobs up and down as the waves roll in.

(b) At what frequency the boat would bob up and down with if it were headed away from the shore at a speed of 4.8 m/s?

(c) At what frequency the boat would bob up and down with if it were headed toward the shore at a speed of 4.8 m/s?

In: Physics

1)The histone proteins of nucelosomes are often abnormally modified in cancer cells, leading to _____. a....

1)The histone proteins of nucelosomes are often abnormally modified in cancer cells, leading to _____. a. an alteration in chromatin structure b. an alteration in levels of transcription c. double-stranded breaks in DNA d. All of the above e. Both a and b

2)

A DNA strand contains the sequence TCGGATGCACCT. A mutation happened that results in the sequence TCCGGATGCACCT. What type of mutation does this change represent?

a point mutation

a missense mutation

frameshift mutation

a silent mutation

3)

Chromosomal rearrangements might position a gene near heterochromatin. The gene's transcription

may be inverted.

may be amplified.

may cease.

will turn on.

In: Biology

Walker Pen Company Jane Dempsey, controller of the Walker Pen Company, was concerned about the recent...

Walker Pen Company
Jane Dempsey, controller of the Walker Pen Company, was concerned about the recent financial trends in operating results. Walker Pen had been the low-cost producer of traditional BLUE pens and BLACK pens. Profit margins were over 22% of sales.
Several years earlier Dennis Selmor, the sales manager, had seen opportunities to expand the business by extending the product line into new products that offered premium selling prices over traditional BLUE and BLACK pens. Five years earlier, RED pens had been introduced; they required the same basic production technology but could be sold at a 3% premium. And last year, PURPLE pens had been introduced because of the 8% premium in selling price they could command.
But Dempsey had just seen the financial results (see Exhibit 1) for the most recent fiscal year and was keenly disappointed.
The new RED and PURPLE pens do seem more profitable than our BLUE and BLACK pens, but overall profitability is down, and even the new products are not earning the margins we used to see from our traditional products. Perhaps this is the tougher global competition I have been reading about. At least the new line, particularly PURPLE pens, is showing much higher margins. Perhaps we should follow Dennis's advice and introduce even more specialty colored pens. Dennis claims that consumers are willing to pay higher prices for these specialty colors.
Jeffrey Donald, the manufacturing manager, was also reflecting on the changed environment at the Walker Pen Company:
Five years ago, life was a lot simpler. We produced just BLUE and BLACK pens in long production runs, and everything ran smoothly, without much intervention. Difficulties started when the RED pens were introduced and we had to make more changeovers. This required us to stop production, empty the vats, clean out all remnants of the previous color, and then start the production of the red ink. Making black ink was simple; we didn't even have to clean out the residual blue ink from the previous run if we just dumped in enough black ink to cover it up. But for the RED pens, even small traces of the blue or black ink created quality problems. And the ink for the new PURPLE pens also has demanding specifications, but not quite as demanding as for RED pens.
We seem to be spending a lot more time on purchasing and scheduling activities and just keeping track of where we stand on existing, backlogged, and future orders. The new computer system we got last year helped a lot to reduce the confusion. But I am concerned about rumors I keep hearing that even more new colors may be introduced in the near future. I don't think we have any more capability to handle additional confusion and complexity in our operations.
Exhibit 1
Traditional Income Statement
Blue Black Red Purple Total
Sales $88,408 $64,328 $15,930 $1,674 $170,340
Material costs 29,298 21,318 5,040 468 $56,124
Direct labor 12,028 8,752 2,106 211 $23,097
Overhead @ 270% 32,476 23,630 5,686 570 $62,362
Total operating income $14,606 $10,628 $3,098 $425 $28,757
Return on sales 17% 17% 19% 25% 17%
Operations
The Walker Pen Company produces pens in a single factory. The major task is preparing and mixing the ink for the different-colored pens. The ink is inserted into the pens in a semiautomated process. A final packing and shipping stage is performed manually.
Each product has a bill of materials that identifies the quantity and cost of direct materials required for the product. A routing sheet identifies the sequence of operations required for each operating step. This information is used to calculate the labor expenses for each of the four products. All of the plant's indirect expenses are aggregated at the plant level and allocated to products on the basis of their direct labor content. Currently, this overhead burden rate is 270% of direct labor cost. Most people in the plant recalled that not too many years ago the overhead rate was only 200%.
Activity-Based Costing
Jane Dempsey recently attended a seminar of her professional organization in which a professor had talked about a new concept, called activity-based costing (ABC). This concept seemed to address many of the problems she had been seeing at the Walker Pen Company. The speaker even used an example that seemed to capture Walker's situation exactly.
The professor argued that overhead should not be viewed as a cost or a burden to be allocated on top of direct labor. Rather, the organization should focus on activities performed by the indirect and support resource of the organization and try to link the cost of performing these activities directly to the products for which they were performed. Dempsey obtained several books and articles on the subject and soon tried to put into practice the message she had heard and read about.
Activity-Based Cost Analysis
Dempsey first identified six categories of support expenses that were currently being allocated to pen production:
Expense Category Expense
Indirect labor $20,626
Fringe benefits 17,489
Computer systems 10,193
Machinery 7,396
Maintenance 4,437
Energy 2,221
Total $62,362
She determined that the fringe benefits were 40% of labor expenses (both direct and indirect) and would thus represent just a percentage markup to be applied on top of direct and indirect labor charges.
Dempsey interviewed department heads in charge of indirect labor and found that three main activities accounted for their work. About 52% of indirect labor was involved in scheduling or handling production runs. This proportion included scheduling production orders; purchasing, preparing, and releasing materials for the production run; performing a first-item inspection every time the process was changed over, and some scrap loss at the beginning of each run until the process settled down. Another 40% of indirect labor was required just for the physical changeover from one color pen to another.
The time to change over to BLACK pens was relatively short (about 1.1 hour) since the previous color did not have to be completely eliminated from the machinery. Other colors required longer changeover times; RED pens required the most extensive changeover to meet the demanding quality specification for this color.
The remaining 8% of the time was spent maintaining records on the four products, including the bill of materials and routing information, monitoring and maintaining a minimum supply of raw materials and finished goods inventory for each product, improving the production processes, and performing engineering changes for the products. Dempsey also collected information on potential activity cost drivers for Walker's activities (see Exhibit 2) and the distribution of the cost drivers for each of the four products. Dempsey next turned her attention to the $10,193 of expenses to operate the company's computer system. She interviewed the managers of the Data Center and the Management Information System departments and found that most of the computer's time (and software expense) was used to schedule production runs in the factory and to order and pay for the materials required in each production run.
Because each production run was made for a particular customer, the computer time required to prepare shipping documents and to invoice and collect from a customer was also included in this activity. In total, about 79% of the computer resource was involved in the production run activity. Almost all of the remaining computer expense (21%) was used to keep records on the four products, including production process and associated engineering change notice information.
The remaining three categories of overhead expense (machine depreciation, machine maintenance, and the energy to operate the machines) were incurred to supply machine capacity to produce the pens. The machines had a practical capacity of 10,100 hours of productive time that could be supplied to pen production.
Dempsey believed that she now had the information she needed to estimate an activity-based cost model for the Walker Pen Company.
Exhibit 2
Direct Costs and Activity Cost Drivers
Blue Black Red Purple Total
Production sales volume
(no. of units) 51,400 37,400 9,000 900 98,700
Unit selling price $1.72 $1.72 $1.77 $1.86
Materials/unit cost $0.57 $0.57 $0.56 $0.52
Direct labor hr/unit 0.02 0.02 0.02 0.02 1,974
Machine hour/unit 0.11 0.09 0.11 0.10 10,100
No. of production runs 53 41 41 11 146
Setup time/run (hours) 4.60 1.10 6.40 3.80
Total setup time (hours) 244 45 262 42 593
Number of products 1 1 1 1 4
Required:
1. Design an Excel model to estimate the costs for the four pen products using an activity-based costing approach (provide a unit cost per pen color).
2. Prepare a revised income statement with profit margin calculations. The income statement should be modeled on Exhibit 1 and include cost by pen color and in total.
3. Write an Executive Memo to Jane Dempsey and Dennis Selmor explaining the managerial implications from the revised cost estimates.
4. Bonus Question: Why is it acceptable for the fringe benefits associated with direct to be in the overhead cost pool when using direct labor as the allocation base and it is not acceptable for the fringe benefits associated with direct labor to be in the overhead cost pool when using ABC?
Round total costs and driver amounts; use 2 decimal places for activity rates and unit costs. After allocating costs, your total overhead cost may have a rounding error of $6.
Hints:
1.) The cost of the blue pen using ABC is: $1.34 (rounded).
2.) The overhead cost pool for the ABC method totals $53,123.
3.) When switching from the plant wide allocation of overhead using direct labor as the allocation base to the ABC method, you must assign to direct labor the fringe benefits associated with direct labor and not maintain this portion of the fringe benefits in the overhead cost pool.
4.) Production is one of four activities used in the analysis.

In: Accounting

Homework 3 Managerial Economics – ECON 301 Instructions: Read each question carefully. If work is required,...

Homework 3

Managerial Economics – ECON 301

Instructions: Read each question carefully. If work is required, show your work to receive full or partial credit. Label all illustrations as necessary.

5 Points:    Your classmate argues that, all else being equal, if the price of ramen noodles increases the demand for ramen noodles decreases. Explain whether your classmate is correct or not?

5 Points:    Assume that ramen noodles are an inferior good. If the recently passed tax cut increase personal income, what impact might this have (all else being equal) on the demand for ramen noodles?

5 Points:    You are doing an analysis of a firm. When the firm’s production was 200 units, it generated 2000 in Total Benefits at a Total Cost of $500. When the firm ramped up production to 210 units, Total Benefits increased to 2200 and Total Cost to $600. What is the marginal benefit and marginal cost of producing 210 units?

5 Points:    Assume that you want to save so that you have $3000 in savings at the end of 5 years. The interest rate is 3%. How much do you have to save today to reach $5000 in savings at the end of 5 years?

5 Points:    Assume that you have won a prize that pays out $30,000 at the end of 5 years. Your classmate offers you $23,000 today for the prize. The opportunity cost of funds is 5%. Should you take your classmate’s offer? Why or why not?

5 Points:    Provide a brief example of the law of diminishing returns.

10 Points: Assume that your business has $15,000 today and wants to invest it to have $25,000 in 5 years. What is the interest rate necessary to make this happen?

10 Points: You receive $200 annually for a perpetual bond. Your classmate says the bond is worth $10,000. What is the assumed interest rate for the classmate>

20 Points: Assume that you are trying to value a firm that has current profits of $5 million. Assume that the opportunity cost of funds is 6% and the constant profit growth rate is 3%.

What is the present value of the firm if the firm does not issue a dividend?

What is the present value of the firm if it does issue a dividend?

30 Points: Given the table below, determine:

Net Benefits

Marginal Benefit

Marginal Cost

Marginal Net Benefits

What is the level of production that maximizes net benefits?

What is the level of marginal net benefits at this level of production?

What is the value of Marginal Benefit and Marginal Cost at this level of production?

What is the general principle (rule) with regards to Marginal Benefits, Marginal Costs, and the level of production that maximizes net benefits?

Q

Total Benefits

Total Cost

0

0

0

1

120

20

2

280

50

3

480

90

4

580

140

5

660

200

6

740

270

7

800

360

8

840

480

In: Economics

2. There may be only one or there may be more than one correct response to...

2. There may be only one or there may be more than one correct response to this question. You need only mark any one of the possible correct responses to be marked correct. A - Touch the top of the electroscope with your finger B - Remove your finger from the top of the electroscope C - Touch the top of the electroscope with a glass rod that was just previously rubbed by silk D - Touch the top of the electroscope with a rubber rod that was just previously rubbed with fur E - Remove the charged glass rod from the vicinity of the electroscope F - Remove the charged rubber rod from the vicinity of the electroscope G - Move the charged glass rod near the top of the electroscope H - Move the charged rubber rod near the top of the electroscope You are provided with an electroscope that may already have placed on it an unbalanced charge (that is the initial state of the electroscope might be overall positive, negative or neutral - you just don’t know!). You wish to make sure the electroscope has a negative charge. The steps you may take in doing this are provided above (A-H). Below is a set of steps done in a precise order that you can perform. Which of these sets of steps done in the order shown will result in the electroscope acquiring a negative charge through the process of conduction? There might be more than one correct set. A, H, B, F A, B, C, G A, D, F, B A, C, G, B A. B. D, F H, A, B, F G, A, B, E

In: Physics

Experiment 2: Static Materials In this experiment, you will investigate the phenomenon of static electricity of...

Experiment 2: Static Materials
In this experiment, you will investigate the phenomenon of static electricity of various materials.

Materials
Electrostatics Kit Materials
*Paper (Any Kind)
*Flat Work Surface     


  
Procedure
1.   Tear the paper into small pieces (approximately the size of a hole-punch) and scatter them in a small area on a table or flat surface.
2.   Choose one plastic strip (acetate [light blue and transparent], vinyl [no color and transparent], or polyethylene [white and translucent]) and one fabric (wool or cotton cloth) from the electrostatics kit.
3.   Quickly rub the fabric up and down the length of the plastic strip for approximately 20 seconds.
4.   Bring the plastic strip near the small, torn pieces of paper.
5.   Record observations about the amount picked up and behavior of the paper in Table 2.
6.   Repeat Steps 2 – 5 for five additional fabric and plastic combinations.


Table 2: Static Electricity Properties of Various Materials

Type of Plastic Type of Fabric Observations



  
    Post-Lab Questions

1.   What happens when you bring the charged plastic strip near the paper pieces? Why does this happen?

2.   Draw a free body diagram of the forces acting on the piece of paper.

3.   Why does the electric force easily overcome the force of gravity and lift the paper off the surface without even touching the paper?

4.   Which of the materials pick up positive charge and which pick up negative charge? How did you determine this?

In: Physics