Coefficient of variation (LO1) Sam Sung is evaluating a new advertising program that
could increase electronics sales. Possible outcomes and probabilities of the outcomes are
shown below. Compute the coefficient of variation.
Bond value (LO3) Applied Software has $1,000 par value bonds outstanding at 12 percent
interest. The bonds will mature in 25 years. Compute the current price of the bonds if the
present yield to maturity is:
a. 11 percent.
b. 13 percent.
c. 16 pe
Aftertax cost of debt (LO3) Telecom Systems can issue debt yielding 8 percent. The
company is in a 35 percent bracket. What is its aftertax cost of debt?
= Yield (1 T)
= 8% (1 .35)
= 8% (.65)
Cash flow (LO2) Assume a corporation has earnings before depreciation and taxes of
$100,000, depreciation of $50,000, and that it has a 30 percent tax bracket. Compute its
cash flow using the format below.
Earnings before depreciation and taxes
Break-Even Analysis is used to
predict future profits/losses
predict results eg produce Product A or Product
Break-Even Point is when Sales Revenue
equals Total Costs
at this point no profit or loss is incur
Cost concepts, Cost
BY GHANENDRA FAGO
Cost refers the amount of expenses spent to generate product or
Cost refers expenditure that may be actual or nominal expenses
incurred to generate output.
Five Imperatives for Improving
cfw_canard L. Berry Tenn NM'UHEDMM
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A. nmununan Tires Add! University
IT rs 11h! me. its. CDMHtNIES to raisc their service aspirations signicantly and for U.S. ea
See discussions, stats, and author profiles for this publication at: https:/www.researchgate.net/publication/225084143
Understanding Customer Expectations of Service
ARTICLE JANUARY 1991
3 AUTHORS, INCLUDING:
Leonard L Berry
How to Calculate Project Costs
by Cynthia Myers
Accurately estimating project costs is crucial to staying within budget.
Get your estimate wrong and you could end up in the red or even
unable to complete the project. While you can employ computer
Breakeven Analysis Defined
Breakeven analysis examines the short run
relationship between changes in volume and
changes in total sales revenue, expenses and
Also known as C-V-P analysis (Cost Volume
among a firms sales,
costs, and operating
profit at various levels
Break-even point is
the Q where TR = TC
(Q1 to Q2 on graph)
Linear Break-Even Analysis
Over small enoug
Chapter 13 - Problem 6: Coefficient of Variation (L01)
Possible outcomes for three investments and their probabilities of occurrence are given below.