1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Paladinen [302]
3 years ago
12

Arturo is a sales manager for the bratney companies, a company that manufactures equipment used in the processing of grains and

other produce. every year, arturo must submit a request for the number of new sales representatives to be hired in the next year. arturo's goal is clear—he must have enough sales reps to service all of britney's customers—but it is often difficult to predict how many customers the company will have. sales are dependent on the economy, weather, farming trends, and a large number of other environmental factors. arturo's decision about how many sales reps to hire is being made under conditions of , because:
Business
1 answer:
Paraphin [41]3 years ago
5 0

The decision must be made under conditions of <u>uncertainty/ambiguity</u> because the goal is clear but the numbers that will be used to calculate the number of sales reps will not be clear until the year is actually over.

You might be interested in
The price of Chive Corp. stock will be either $86 or $119 at the end of the year. Call options are available with one year to ex
marshall27 [118]

Answer and Explanation:

a). Step 1: Calculate the option value at expiration based upon your assumption of a 50% chance of increasing to $119 and a 50% chance of decreasing to $86.

The two possible stock prices are:

S+ = $119 and S– = $86. Therefore, since the exercise price is $85, the corresponding two possible call values are:

Cu= $34 and Cd= $1.

Step 2: Calculate the hedge ratio:

(Cu– Cd)/(uS0– dS0) = (34 – 1)/(119 – 86) = 33/33 = 1

Step 3: Form a riskless portfolio made up of one share of stock and one written calls. The cost of the riskless portfolio is:

(S0– C0) = 97 – C0

and the certain end-of-year value is $86.

Step 4: Calculate the present value of $86 with a one-year interest rate of 5%:

$86/1.05 = $81.90

Step 5: Set the value of the hedged position equal to the present value of the certain payoff:

$97 – C0= $81.90

C0 = $97 - $81.90 = $15.10

b). Step 1: Calculate the option value at expiration based upon your assumption of a 50% chance of increasing to $119 and a 50% chance of decreasing to $86.

The two possible stock prices are:

S+ = $119 and S– = $86. Therefore, since the exercise price is $115, the corresponding two possible call values are:

Cu= $4 and Cd= $0.

Step 2: Calculate the hedge ratio:

(Cu– Cd)/(uS0– dS0) = (4 – 0)/(119 – 86) = 4/33

Step 3: Form a riskless portfolio made up of four shares of stock and thirty three written calls. The cost of the riskless portfolio is:

(4S0– 33C0) = 4(97) – 33C0 = 388 - 33C0

and the certain end-of-year value is $86.

Step 4: Calculate the present value of $86 with a one-year interest rate of 5%:

$86/1.05 = $81.90

Step 5: Set the value of the hedged position equal to the present value of the certain payoff:

$388 – 33C0= $81.90

33C0 = $388 - $81.90

C0 = $306.10 / 33 = $9.28

3 0
3 years ago
Which herbs are useful from cosmetic point of view ? also name the products made from them<br>​
Tcecarenko [31]
Aloe Vera is a very common item found in cosmetics. Such items as body lotions, creams, sunscreen, serums, and moisturizers all use aloe vera!
8 0
2 years ago
Select all that apply. Which of the following items demonstrate poor choices made by private property owners?
pashok25 [27]
The first one the third one and possibly the last one. I'm unsure about the last one because depending on the amount of scorpions that are hunted, the food web in that area could be negatively impacted.
4 0
3 years ago
Read 2 more answers
Donna, vice president of finance, and bob, vice president of human resources, are ____ managers.
LuckyWell [14K]

They are considered to be functional managers—a functional manager is those people with authority that are given to them in a way of controlling a certain department, business or organization, in other words, they have to manage an organizational unit.

5 0
3 years ago
Parbonetti Corporation recently reported $8,250 of sales, $4,500 of operating costs other than depreciation, and $950 depreciati
Gnom [1K]

How much free cash flow did Wells generate is $1,770

First step is to Determine the Operating income (EBIT)

Sales $8,250

Less Operating costs excluding depreciation ($4,500)

Less Depreciation ($950)

Operating income (EBIT)$2,800

($8,250-$4,500-$950)

Now let determine How much free cash flow did Wells generate using this formula

FCF = EBIT(1 -Tax rate) + Depreciation- Required capital expenditures -Required addition to net operating working capital

Let plug in the formula

FCF = $2,800×(1-0.35)+$950 -$750 -$250

FCF = $2,800×(0.65)+$950 -$750 -$250

FCF = $1,820 + $950 -$750 -$250

FCF = $1,770

Inconclusion How much free cash flow did Wells generate is $1,770

Learn more here:

brainly.com/question/14495667

8 0
3 years ago
Other questions:
  • Walter Waterson owns a lawn irrigation system business. He manages the installations and maintenance of these systems. Several c
    9·1 answer
  • On january 1, applied technologies corporation (atc) issued $510,000 in bonds that mature in 10 years. the bonds have a stated i
    15·1 answer
  • An online store promises to deliver any order costing over $60 within 24 hours. It uses this strategy to increase the volume of
    10·1 answer
  • Increasingly concerned about my minor heartbeat irregularities, I think that my health is being threatened, and more and more of
    14·1 answer
  • A number of yogurts are marketed under the Dannon brand, including Dannon All Natural, Dannon Fruit on the Bottom, Dannon Light
    15·1 answer
  • When the consumer uses many evaluative criteria such as fuel economy, acceleration speed, and the availability of extra features
    13·1 answer
  • Which statement corresponds to this specific situation?
    10·1 answer
  • Sugar City issued $2 million of bonds to fund the construction of a new city office building. The bonds have a stated rate of in
    11·1 answer
  • All of the following are examples of labour intensive industry EXCEPT: *
    14·1 answer
  • Is certificate of deposit money stuck?
    8·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!