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3 years ago

You would use scenario analysis when:________.

Business

1 answer:

KATRIN_1 [288]3 years ago

3 0

Answer:

d. Comparing different business cases about the future with multiple variables changed

Explanation:

I would start off by defining scenario analysis first. Scenario analysis can be defined as a process whereby future values of a portfolio investment can be predicted given that an event may occur or may not occur. In other words, it is a way of knowing what would happen to the values of a portfolio if a particular event occurs or if the event doesnt occur.

Given this explanation, the right answer to this question is option d, Comparing different business cases about the future with multiple variables changed

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If markets are efficient, what should be the correlation coefficient between stock returns for two nonoverlapping time periods?

S_A_V [24]

Answer: Zero

Explanation:

The Correlation Coefficient measures the relationship between 2 variables under study and ranges from -1 to +1 which -1 meaning that the two are perfectly negatively correlated and +1 meaning they are perfectly positively correlation. A Correlation Coefficient of 0 means that there is no relationship.

An efficient market is one where all information is available to every market participant. This means that one cannot use information from one period to make abnormal profits in another period because all information is available. The Correlation Coefficient will therefore show 0 because information from the previous period is not being used in another period meaning there is no relationship between stock returns.

7 0

3 years ago

Assets Current assets $38,000,000 Net plant, property, and equipment $101,000,000 Total assets $139,000,000 Liabilities and Equi

Reil [10]

Answer:

9.73%

Explanation:

the market value of equity = 10,000,000 stocks x $15 = $150,000,000

the market value of debt = 40,000 bonds x $1,150 = $46,000,000

total = $196,000,000

weight of equity = 0.7653

weight of debt = 0.2347

Re = 3.5% + [1.35 x (0.115 - 0.055)] = 0.035 + 0.081 = 0.116

cost of debt = ytm = {36.25 + [(1,000 - 1,150)/40]} / [(1,000 + 1,150)/2] = (36.25 - 3.75) / 1,075 = 32.50 / 1,075 = 0.03023 x 2 = 0.0605

after tax cost of debt = 0.0605 x (1 - 40%) = 0.0363

WACC = (0.116 x 0.7653) + (0.0363 x 0.2347) = 0.09729 = 9.73%

3 0

3 years ago

New Coffee Company, LLC uses JIT (just-in-time) logistical supply methods. This indicates that the company doesn't really keep l

Leona [35]

Answer:

B) Inventory turnover ratios

Explanation:

Inventory turnover measures how many times a business sells and replaces its merchandise or materials inventory during an accounting period, usually a year.

One of the basic goals of JIT is to lower the total inventories in a company, therefore increasing the inventory turnover ratio. This reduces the company's operating costs.

4 0

3 years ago

A non-linear production possibilities model assumes that

mixer [17]

A non-linear production is also known as a bending producing model. A non-linear production possibilities model estimates what amount of something can be produced using the economy's current resources and technology to make the predictions.

3 0

3 years ago

Read 2 more answers

Wholemark is an Internet order business that sells one popular New Year greeting card once a year. The cost of the paper on whic

Kay [80]

Answer:

≈ 9644 quantity of card

Explanation:

given data:

n = 4 regions/areas

mean demand = 2300

standard deviation = 200

cost of card (c) = $0.5

selling price (p) = $3.75

salvage value of card ( v ) = $ 0

The optimal production quantity for the card can be calculated using this formula below

= u + z (0.8667 ) * б

= 9200 + 1.110926 * 400

≈ 9644 quantity of card

First we have to find u

u = n * mean demand

= 4 * 2300 = 9200

next we find the value of Z

Z = ( $\frac{p-c}{p-v}$ )

= ( 3.75 - 0.5 ) / 3.75 = 0.8667

Z( 0.8667 ) = 1.110926 ( using excel formula : NORMSINV (0.8667 )

next we find б

б = 200 $\sqrt{n}$ = 400

7 0

3 years ago