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FinnZ [79.3K]
3 years ago
7

Suppose Microsoft stock will provide either a return of 10 or 20 percent over the next year and that the probability of the form

er outcome is 0.25 while the probability of the latter is 0.75. If the utility an investor derives from a 10 percent return on Microsoft stock is 200 and the utility the investor derives from a 20 percent return is 400, the investor's expected utility from holding Microsoft stock is _____.
Business
1 answer:
nignag [31]3 years ago
5 0

Answer:

The correct answer is b. 350.

Explanation:

To calculate the expected profit, we use the data from the statement:

10% Yield = 25% Probability

20% Yield = 75% Probability

Profit 10% = 200 * 25%

Profit 20% = 400 * 75%

TOTAL 30% = 50 + 300 = 350

What was done was multiply the percentages of profit vs. the expected return for each group of actions. The sum of both is the total expected by investors as Microsoft profits.

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When a person is unable to make a decision because they have no way to process and weigh the risks and rewards in front of them,
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The answer is Analysis Paralysis.  <span />
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As a graphic artist, Randy has just finished a new calendar. The calendar cost him $1.00 for the glossy paper, $3.00 for the six
Yanka [14]

Answer:

Break-even units = 66.67 units

Explanation:

<em>Break-even point is the level of activity that achieves no profit or loss. At this level profit is zero because the the total revenue is equal to total cost.</em>

<em>The break-even point is calculated as </em>

<em>Units to achieve target profit = (Total general fixed cost for the period + target profit)/ contribution per unit</em>

Contribution per unit = Selling Price - Variable cost

Contribution per unit = 15- (1+3+0.50) = 10.5

Fixed cost = 500 +( 50× 4) = 700

So the units requited to achieve break-even point:

Break-even point =  700/10.5

                            = 66.67 units

4 0
3 years ago
Following are account balances (in millions of dollars) from a recent FedEx annual report, followed by several typical transacti
Paraphin [41]

Answer:

FedEx

1&2: T-accounts:

Cash

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

Balance                                         2,328

a. Delivery Service Revenue      17,600

c. Prepaid Expenses                                       3,728

c. Rent Expenses                                           10,136

d. Repairs Expenses                                       3,864

e. Accounts Receivable            24,285

f. Long-term Note Payable                               350

g. Common stock                              2

g. APIC                                              14

h. Salaries                                                     15,276

i. Fuel Expenses                                            8,564

j. Accounts Payable                                          784

Balance                                                          1,527

Prepaid expenses

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

Balance                                         329

c. Cash                                       3,728

Balance                                                         4,057

Spare parts, supplies, and fuel

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

Balance                                         437

Accounts Receivables

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

Balance                                         4,581

a. Delivery Service Revenue     21,704

e. Cash                                                        24,285

Balance                                                         2,000

Other current assets

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

Balance                                         610

Property and equipment (net)

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

Balance                                         15,543

b. Long-term Note Payable           3,434

Balance                                                       18,977

Other noncurrent assets

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

Balance                                         3,557

Accounts payable

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

Balance                                                          1,702

j. Cash                                             784

Balance                                           918

Accrued expenses payable

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

Balance                                                          1,894

Other current liabilities

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

Balance                                                          1,286

Long-term notes payable

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

Balance                                                          1,667

b. Property and Equipment                          3,434

f. Cash                                            350

Balance                                        4,751

Other noncurrent liabilities

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

Balance                                                          5,616

Common stock ($0.10 par value)

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

Balance                                                          32

g. Cash                                                             2

Balance                                           34

Additional Paid-in Capital

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

Balance                                                          2,472

g. Cash                                                                14    

Balance                                           2,486

Retained earnings

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

Balance                                                          12,716

Delivery Service Revenue

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

a. Accounts receivable                                 21,704              

a. Cash                                                          17,600

Balance                                     39,304

Rent Expense

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

c. Cash                                       10,136

Repairs Expense

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

d. Cash                                        3,864

Salaries Expense

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

h. Cash                                      15,276

Fuel Expense

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

i. Cash                                        8,564

                                               

3. Income Statement for the year ended May 31, 2015:

Delivery Service Revenue                         39,304

Rent Expense                            10,136

Repair Expense                         3,864

Salaries Expense                     15,276

Fuel Expense                            8,564       37,840

Net Income                                                   1,464

Explanation:

a) Account Balances on May 31, 2014:

Trial Balance as of May 31, 2014:

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

Cash                                               2,328

Prepaid expenses                            329

Spare parts, supplies, and fuel       437

Receivables                                   4,581

Other current assets                       610

Property and equipment (net)   15,543

Other noncurrent assets            3,557

Accounts payable                                          1,702

Accrued expenses payable                          1,894

Other current liabilities                                 1,286

Long-term notes payable                             1,667

Other noncurrent liabilities                          5,616

Common stock ($0.10 par value)                     32

Additional Paid-in Capital                            2,472

Retained earnings                                       12,716

Totals                                       $27,385  $27,385      

Other transactions for year ending May 31, 2015:

a. Delivery Service Revenue $21,704 Account Receivable $21,704

   Delivery Service Revenue $17,600 Cash $17,600

b. Equipment $3,434 Long-term Note Payable $3,434

c. Rent Expense $10,136; Prepaid (Rent) Expense $3,720 Cash $13,864

d. Repair Expenses $3,864 Cash $3,864

e. Cash $24,285 Accounts Receivable $24,285

f. Long-term Note Payable $350 Cash $350

g. Cash $16 Common Stock $2 APIC $14

h. Salaries Expense $15,276 Cash $15,276

i. Fuelling Expense $8,564 Cash $8,564

j. Accounts Payable $784  Cash $784

k. N/A

Trial Balance as of May 31, 2015:

Account Titles                              Debit        Credit

                                                  ('millions)  ('millions)

Cash                                                1,527

Prepaid expenses                         4,057

Spare parts, supplies, and fuel       437

Receivables                                  2,000

Other current assets                       610

Property and equipment (net)   18,977

Other noncurrent assets            3,557

Accounts payable                                            918

Accrued expenses payable                          1,894

Other current liabilities                                 1,286

Long-term notes payable                             4,751

Other noncurrent liabilities                          5,616

Common stock ($0.10 par value)                     34

Additional Paid-in Capital                            2,486

Retained earnings                                       12,716

Delivery Service Revenue                         39,304

Rent Expense                            10,136

Repair Expense                         3,864

Salaries Expense                     15,276

Fuel Expense                            8,564

Totals                                    $69,005   $69,005

3 0
3 years ago
EPA regulations permit the release of 150 micrograms of particulate matter per cubic meter of air every 24 hours from paint shop
lesya [120]

Answer:

Legal approach of green management  Utilimotors use

Explanation:

we use here Legal approach

because Legal approach is the type of green management approach and which is simply following that what is required by the law

and They try to comply with the current laws and regulations

but do not go anything further.

so here Utilimotor is using the legal approach by following the EPA regulation and ensuring to release emissions only within the permissible limit

so Legal approach of green management  Utilimotor use

3 0
3 years ago
An electronics company has factories in Cleveland and Toledo that manufacture three head and forehead VCRs. Each day the Clevela
Vesna [10]

Answer:

The Toledo factory should work for 20 days

The Cleveland factory should work for 50 days

Explanation:

Let me use abbreviations to denote each of the VCR produces:

Three head  VCR = THV

Four head VCR = FHV

we were told that:

Cleveland in one day produces; 500 THV and 300 FHV at a price of $18000, while Toledo in one day produces; 300 THV and 300 FHV at a price of $15000.

Information on order received:

THV = 25,000

FHV = 21000

Next let us use the common factor between both company locations to divide the production days between them, and the common product produced equally by these two factories is FHV where each of them produce 300 in a day.

hence to fill an order of 21,000 FHV, each factory has to produce 21000 ÷ 2 = 10, 500 orders each.

Now let us find how many days it will take to produce 10,500 orders if they produce 300 orders each day:

300 FHV = 1 day

∴ 10,500 FHV = \frac{1}{300} × \frac{10,500}{1} = 35 days.

Therefore, if both factories were to be producing the same amount of both THV and FHV each it will take them 35 days each to fill the order, but because Cleveland factory produces 500 THV while Toledo produces 300 THV, this will not hold since at the end of 35 days:

the Cleveland factory will produce 35 × 500 = 17,500 THV

the Toledo factory will produce 35 × 300 = 10,500 THV, bringing the total number of THV to 28,000 which is 3000 more than the order of 25,000 THVs

Next, we have to work backwards.Since the Cleveland factory has an excess of 3000 THVs, let us see how many days it will take to produce the excess 3000 THVs and remove that number of days from the Cleveland factory, while adding that same number of days to the Toledo factory, to even things out.

So removing one day from Cleveland will reduce production of THVs by 500, while concurrently adding one day to FHV will increase production of THV by 300, creating a net production of 200 THVs being removed.

Remember that the excess THV produced was 3000, to get the total number of days to remove from Cleveland and to add to Toledo, we will divide 3000 by 200.

∴ 3000 ÷ 200 = 15.

hence we will subtract 15 days from the original 35 days of Cleveland while we add 15 days to the original 35 of Toledo giving us:

Cleveland: 35 - 15 = 20 days

Toledo: 35 + 15 = 50 days.

now let us test our answer.

for THV:

Cleveland working for 20 days will produce; 500 × 20 = 10000

Toledo working for 50 days will produce; 300 × 50 = 15000

giving a total of 10000 + 15000 = 25,000 three head VCRs.

for Four Head VCRs (FHV)

Cleveland working for 20 days will produce; 300 × 20 = 6,000

Toledo working for 50 days will produce; 300 × 50 = 15,000

therefore total Four head VCRs produced = 6,000 + 15,000 = 21,000 VCRs.

and the total cost of production:

Cleveland; 1 day = $18,000

∴ 20 days = 18,000 × 20 = $360,000

while Toledo in 50 days = 15000 × 50 = $750,000. Hence the total amount for production = $360,000 + $750,000 = $1,110,000

3 0
3 years ago
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