Scenario Questions

Scenario Questions

 

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current yield (CY)

A 10-year, 5% semiannual coupon bond selling for $1,135.90 can be called in 4 years for $1,200 (hint: par value is $1,000). What s its current yield (CY)?

CV

 Samuel found two opportunities of investment A (rate of return 2%, standard deviation 1%) and investment B (rate of return 4%, standard deviation 8%). Investment B is better than Investment A (hints: calculate each CV and then compare each other).

A. True B. False

SBUX

Choose and calculate three ratios for Starbucks for the last two years. Make sure to select ratios that you think would be impacted by expanding in a new market, and explain your reasoning. Identify a competitor of SBUX and contrast the ratios. Explain why you selected this competitor. Describe how the decisions made by management, marketing and operations functions of the company can impact, and hopefully improve, these financial ratios.

financial decisions

Explain how the financial decisions regarding opening a new store are related to management, marketing or operations decisions that the company must make (or has made)?

U.S. import

Which of the following is NOT an important U.S. import?

a) electronic products   b) motor vehicles  c) aircraft   d) coffee and tea

Fiscal Policy

Fiscal Policy is __________.

a) Limits on the amount of a product imported

b) Recurring pattern of ups and downs in the nation’s business activity

c) Government’s taxing and spending decisions which are intended to improve the economy

d) Deep extended decline in the nation’s economy.

skeletal profit loss statement

Set up a skeletal profit loss statement in both dollars and percentage if your year-end profit is %7,800, the profit percentage is 3.9%, and your yearly cost of goods sold is $120,000.

stimulate the economy

What can the Fed do to stimulate the economy if it feels it is growing too slowly?

communication

Describe how communication should occur in organizations.

specialty stores and chain supermarkets

 Your family business produces a secret recipe salsa and distributes it through both smaller specialty stores and chain supermarkets. The chains have been demanding sizable discounts but you do not want to drop your prices to the specialty stores. When can you legally accommodate the chains without losing profits from the specialty stores?