What distinguishes an outsourcing arrangement from any other business arrangement is the transfer of ownership of an organization’s business activities (processes or functions)-or the responsibility for the business outcomes flowing from these activities-to a service provider. In a typical outsourcing arrangement, the people, the facilities, the equipment and the technology (the Factors of Production) are also transferred to the service provider, which then uses the Factors of Production to provide the services back to the organization. The people are often transferred to the service provider, but this is not always the case.
An outsourcing arrangement can be either “tactical” or “strategic.” An outsourcing is tactical when it is driven by a desire to solve a practical problem. For example, a company may find that its payroll clerk is not able to process payroll changes, cheques, tax returns and make the required accounting entries on time. The company concludes that although the payroll clerk is competent, there is too much work for a single person. The company outsources the payroll process (including the clerk), and ends up with all of the payroll work done on time and at a lower cost. As a result, it achieves a net gain in operational efficiency. Similarly, if an organization outsources its IT infrastructure so it can save five to 10 per cent on the cost of operating that function, the outsourcing is purely tactical.
“Strategic” outsourcing, on the other hand, is not driven by a problem-solving mentality. Instead, it is structured so that it is aligned with the company’s long-term strategies. The changes that organizations expect from strategic outsourcing vary and can include anything from
Answer:
c. The beta of the portfolio is lower than the lowest of the three betas.
Explanation:
As for any investment portfolio, with number of investments, each investment has its own beta.
When we compute the beta for entire portfolio, the beta is based on weighted average of investments.
Under the weighted average method there are weights assigned on the basis of value of individual investment, out of total value of investment.
Thus, the beta for portfolio, can never be less than the least beta of any individual investment in a portfolio.
Answer:
The answer is: A) Bottom of the pyramid strategy.
Explanation:
In a bottom of the pyramid strategy a company develops new products or services that target the lower class customers in a market or are designed for the poorest regions or countries.
Digitec Company developed a very cheap laptop and will sell it on extremely poor areas. Usually a product developed specifically for this type of strategy wouldn´t be able to sell well in a richer market. For instance, not very many people would buy a $50 laptop in the US or Europe, since it probably doesn´t have the same technical specs as the rest of the competition.
Answer:
Debit Accounts Payable $200; credit Merchandise Inventory $200
Explanation:
The journal entry is shown below:
Account payable A/c Dr $200
To Merchandise Inventory A/c $200
(Being the returned inventory is recorded)
For recording this journal entry we debited the account payable as it reduced the liabilities and at the same time it also reduced the asset so that the proper posting could be done
Answer:
Coupon rate is 5.17%
Explanation:
Yield to maturity is the annual rate of return that an investor receives if a bond bond is held until the maturity.
Assuming Face value of the bond is $1,000
Face value = F = $1,000
Selling price = P = $948
Number of payment = n = 9 years
Bond Yield = 5.9%
The coupon rate can be calculated using following formula
Yield to maturity = [ C + ( F - P ) / n ] / [ (F + P ) / 2 ]
5.9% = [ C + ( $1,000 - $948 ) / 9 ] / [ ( $1,000 + $948 ) / 2 ]
5.9% = [ C + $5.78 ] / $974
5.9% x $974 = C + $5.78
$57.466 = C + $5.78
C = $57.466 - $5.78 = $51.686
Coupon rate = $51.686 / $1,000 = 0.051686 = 5.17%
