MBA 6400 Case Study #2
Short-term investment returns: money market instruments
Part of your responsibilities as a junior financial analyst is researching and identifying potential shortterm liquid investment options for your firm. These investment vehicles are at times used by the firm during periods when their cash inflows exceed projections. The firm, at times, uses excess cash to purchase short-term debt instruments providing a low, but safe marginal return on invested capital.
Your Director, who reports to the firm’s Chief Financial Officer (CFO) has come to you seeking your recommendation on short-term investment options for the upcoming year. The Director has asked for recommendations and a report illustrating your optimal analysis for investing $2.5m of excess cash.
Current background info: We have a potential impending compound money market problem: The U.S. is issuing more debt, in part due to the recent tax cuts. Simultaneously, the Fed, China, Japan and to a lesser degree Russia have been reducing their holdings of U.S. Debt. Therefore, if the U.S. Treasury Department can’t get entities to their positions holding U.S. debt, then the pressure to increase interest rates to make newly issued securities attractive increases. Increased interest rates at the Treasury means securities prices fall with cascading impacts.
Therefore, the current interest rate environment is one where rates are expected to increase.
Parameters for the research and analysis report are as follows:
1. Investments selections are primarily short term (one year or less), but will consider U.S. Treasury Bills of shorter duration as well as TIPS.
2. A minimum of 3 short term debt money market security types are to be recommended. They may include Federal money market bills, U.S. Savings Bonds, CDs, U.S. Treasury Notes, Treasury Bills, and TIPS.
a. Note: money market investments of the range of two to five years are acceptable.
b. However, no more than 40% of the portfolio can be invested in a security of with duration of greater than 12 months.
3. A recommendation on the optimal allocation of $2.5 m across the investment portfolio is required.
4. Current (as of the date of this assignment) rates and investments are to be used.
The analysis report to be presented to the Director is to include:
1. Your concise statement and recommendation of the specific short-term investment options that meets the firm’s criteria.
Followed by:
2. A detailed summary of the investment asset and the parameters you will use in which to base your recommendation.
3. A detailed description of the upside and downside risk of each investment. The latter is of particular importance as the firm may decide to manage excess cash in one or more vehicles for longer than one year.
4. Source identifier for all investment selections
a. Example: website URL
5. A spreadsheet (embedded into the report) illustrating the following:
a. Asset category/classification
b. Specific money market instrument identifier
i. Example: U.S. Treasury CUSIP
6. EAR for each investment
7. YTM for each investment
a. If held to maturity
b. If sold at the end of 12 months
8. Total return for investment portfolio if held to maturity
9. Spreadsheet model is to include all cell-based formulas for all calculations
Your conclusion is to summarize the recommendation made in item #1 above
Format for report. Your report must:
1. Be presented in Word file format
2. Analysis must be between, including spreadsheet analysis
3. Excel spreadsheet is embedded into the Word file
4. Submit Excel file separately
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Mayker Inc And Oylco Contracted To Have Oylco Be The Exclusive Provider Of Mayke
/in Uncategorized /by developerMayker, Inc. and Oylco contracted to have Oylco be the exclusive provider of Mayker’s fuel oil for three months. The stated price was subject to increases of up to a total of 10% if the market price increased. The market price rose 25% and Mayker tripled its normal order. Oylco seeks to avoid performance. Oylco’s best argument in support of its position is that:
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Maynard Inc Has No Debt Outstanding And A Total Market Value Of 250 000 Earnings
/in Uncategorized /by developerMaynard Inc. has no debt outstanding and a total market value of $250,000. Earnings before interest and taxes, EBIT, are projected to be $28,000 if economic conditions are normal. If there is a strong expansion in the economy, than EBIT will be 30 percent higher. If there is a recession, than EBIT will be 50 percent lower. Maynard is considering a $90,000 debt issue with a 7% interest rate. The proceeds will be used to repurchase shares of stock. There are currently 5,000 shares outstanding. Suppose this company has a market-to-book ratio of 1.0. A) Calculate return on equity (ROE) under each of there three economic scenarios before any debt is issued. Also calculate the percentage changes in ROE for economic expansion and recession, assuming no taxes. B) Repeat part (A) assuming the firm goes through with the proposed recapitalization. C) Repeat parts (a) and (b) of this problem assuming the firm has a tax rate of 35%
DATA GIVEN:Debtmarket value of firmEBIT (normal)EBIT (recession)EBIT( expansion)Debt issue consierationDebt size = D =rate of interest =kd=Market to book ratio =market value of firm =…
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Mazidah And Shukri Want To Save Rm 10 000 For A Down Payment On A Home They Hope
/in Uncategorized /by developerMazidah and Shukri want to save RM 10,000 for a down payment on a home they hope to buy in 2 years. They invest RM 4,400 at the end of every six months in an account earning 9 % compounded semi-annually
Explain the concept of the Principal and Maturity value
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Mazzone And Associates Accounts Receivable Control Account In The General Ledger
/in Uncategorized /by developerMazzone and Associates Accounts Receivable Control account in the general ledger on 1 September was $ 17755. The subsidiary ledger contained the following accounts receivable accounts and balances at the same date: Quach $2330. Ridley $4277, Scafidi $3337, Talbot $7811. At 30 september a summary of entries made in the journals shown were;General journal: Talbot returned goods for a credit of $178.Sales journal: Recorded credit sales were; Talbot $1290. Quach $2180. Ubhey $1670, Scafidi $1780.Cash receipts journal: cash amounts received from accounts receivable were (no discounts were allowed): Talbot $3730, Ubhey $660, Scafidi $2120, Ridley $2920, Quach $2010.RequiredA.
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Mb 515 Economic Theory Final Team Project Assignment The Idea Or Goal Of The Fin
/in Uncategorized /by developerHello, I need on this project- I need to do steps 2, 4 and 5. I have struggled with this class for the past 7 weeks and I truly need someone to help me. I have attached the outline. Our project is to create a survey with a series of questions, we will all be surveying 10 people and having them answer 30 questions in regards to driving on vacation based on miles, the age of the vehicle and the price of gas. Our goal is to find the relationship between the miles that people drive on vacation to the price of gas, age of the vehicle and the number of children that will also be taken on vacation.
Our equations would be:
M= a +bP + cA + dN
M= Miles people drive on vacation
P+ Price of gas per gallon
A= Age of the vehicle
N= Number of Children in the family
We will be doing a regression analysis on the price per gallon of gas, as well as one for the age of the car , and one for the number of children.
I need to do the following: So he wants it broken down like this.
1. Relationship between miles and price of gas, questions 3-12, 10 questions * 30 surveys = 300 observations
2. Relationship between miles and age of the car, questions 13-23, 11 questions, 330 observation.
3. Relationship between miles and number of children, questions 24-29, 6 questions, 180 observations
4. Relationship between miles and price of gas, age of car, number of children, M=f(P,A,N)
5. Relationship between miles and price of gas, age of car, M=f(P,A)
6. Relationship between miles and price of gas, number of children, M=f(P,N)
7. Relationship between miles drove on vacation to age of car, using the answers from questions 1 and 2.
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Mba 502 Concordia University Homework Assignment After Running A Ski Repair Sh
/in Uncategorized /by developerTake the 10 transactions and insert them into the Excel spreadsheet. Once the 10 transactions are inserted, create:
Homework Problem David’s Repair ShopTransaction AnalysisFor the month of MayTransaction1234567891011Total CashAccts Receivable10,000(400)(5,000)(500)(250)6,100(1,000)…
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Mba 604 607 Take Home Exam Fall 2015 This Is A Take Home Exam You May Use Only Y
/in Uncategorized /by developer2. An incumbent firm is considering expanding its capacity. It can do so in one of two ways. It can purchase fungible, general purpose equipment and machinery that can be resold at close to its original value. Or it can invest in highly specialized machinery that, once it is put in place, has virtually no salvage value. Assuming that each choice results in the same production costs once installed, under which choice is the incumbent likely to encounter a greater likelihood of entry and why? (2 paragraphs max) (10 points)
3.In seeking an injunction to stop Coca Cola’s proposed acquisition of Dr. Pepper, the Federal Trade Commission (FTC) argued that the appropriate line of commerce was “carbonated soft drinks” and referred to the impact of the acquisition on market structure in “geographical submarkets”. Discuss the ambiguities that arise in market definition and show how these would lend support to the FTC’s case. (1-3 paragraphs) (10 points))
4.
Indicate whether the strategic effect of the following competitive move is likely to be positive (beneficial to the firm making them) or negative (harmful to the firm making them).
Two producers of printing presses – one located in the United States and the other located in Europe – compete in the European market as Cournot quantity competitors. The U.S. manufacturer lobbies the U.S. government to give it an export subsidy, the amount of which is directly proportional to the amount of output the firm sells in the European market. (2 paragraphs max) (10 points)
Attached Q7
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Mba 620 Financial Decision Making
/in Uncategorized /by developerQuestion 2: At the profit-maximizing level, what is the relationship between marginal cost, marginal revenue, price, and average cost for firms in competitive and oligopolistic industries?
The CFO has provided the following information to you:
She wants you to analyze the fixed and variable costs, optimal level of production, and profit for the MiniZ component.
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Mba 6400 Case Study 2 Short Term Investment Returns
/in Uncategorized /by developerMBA 6400 Case Study #2
Short-term investment returns: money market instruments
Part of your responsibilities as a junior financial analyst is researching and identifying potential shortterm liquid investment options for your firm. These investment vehicles are at times used by the firm during periods when their cash inflows exceed projections. The firm, at times, uses excess cash to purchase short-term debt instruments providing a low, but safe marginal return on invested capital.
Your Director, who reports to the firm’s Chief Financial Officer (CFO) has come to you seeking your recommendation on short-term investment options for the upcoming year. The Director has asked for recommendations and a report illustrating your optimal analysis for investing $2.5m of excess cash.
Current background info: We have a potential impending compound money market problem: The U.S. is issuing more debt, in part due to the recent tax cuts. Simultaneously, the Fed, China, Japan and to a lesser degree Russia have been reducing their holdings of U.S. Debt. Therefore, if the U.S. Treasury Department can’t get entities to their positions holding U.S. debt, then the pressure to increase interest rates to make newly issued securities attractive increases. Increased interest rates at the Treasury means securities prices fall with cascading impacts.
Therefore, the current interest rate environment is one where rates are expected to increase.
Parameters for the research and analysis report are as follows:
1. Investments selections are primarily short term (one year or less), but will consider U.S. Treasury Bills of shorter duration as well as TIPS.
2. A minimum of 3 short term debt money market security types are to be recommended. They may include Federal money market bills, U.S. Savings Bonds, CDs, U.S. Treasury Notes, Treasury Bills, and TIPS.
a. Note: money market investments of the range of two to five years are acceptable.
b. However, no more than 40% of the portfolio can be invested in a security of with duration of greater than 12 months.
3. A recommendation on the optimal allocation of $2.5 m across the investment portfolio is required.
4. Current (as of the date of this assignment) rates and investments are to be used.
The analysis report to be presented to the Director is to include:
1. Your concise statement and recommendation of the specific short-term investment options that meets the firm’s criteria.
Followed by:
2. A detailed summary of the investment asset and the parameters you will use in which to base your recommendation.
3. A detailed description of the upside and downside risk of each investment. The latter is of particular importance as the firm may decide to manage excess cash in one or more vehicles for longer than one year.
4. Source identifier for all investment selections
a. Example: website URL
5. A spreadsheet (embedded into the report) illustrating the following:
a. Asset category/classification
b. Specific money market instrument identifier
i. Example: U.S. Treasury CUSIP
6. EAR for each investment
7. YTM for each investment
a. If held to maturity
b. If sold at the end of 12 months
8. Total return for investment portfolio if held to maturity
9. Spreadsheet model is to include all cell-based formulas for all calculations
Your conclusion is to summarize the recommendation made in item #1 above
Format for report. Your report must:
1. Be presented in Word file format
2. Analysis must be between, including spreadsheet analysis
3. Excel spreadsheet is embedded into the Word file
4. Submit Excel file separately
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Mba Focus Paper Trend Micro Trend Micro Is An Internet Antivirus Software Compan
/in Uncategorized /by developerMBA Focus Paper: Trend Micro Trend Micro is an Internet antivirus software company. The main virus response center is in the Philippines, where engineers work evening and midnight shifts as needed. Other labs are scattered from Munich to Tokyo. The financial headquarters is in Tokyo, where it went public; product development is in PhD-rich Taiwan; and most of its sales are in Silicon Valley inside the giant American market. Trend Micro is a global company that is growing, but lately the CEO has begun to think that maybe the company needs regional headquarter sites as well. In addition, critics of the company claim that the wrong kind of technology is being transferred to developing nations and that the company is not substantially increasing employment in these lesser developed countries. Furthermore, some critics claim that the company is taking more wealth from these lesser developed nations than it brings to them. The CEO thinks marketing should be able to handle and avert these criticisms. Marketing claims that there is nothing it can do. You have been designated by the CEO to head up this global team to address these concerns. Submit the following assignment checklist items as evidence of your ability to work effectively across functional and geographical boundaries of the organization on this corporate assignment. Assignment Checklist Include the following documentation in your final submission to the Dropbox. 1. Exhibit in an organizational chart which departments you will source your team from and why. 2. Categorize what information you will need from each team member to address the problems of: a) headquarters designation and organization of Trend Micro going forward b) increasing employment in lesser developed countries c) Increasing the positive press coverage on your initiatives d) addressing the concern about technology transfer to developing nations 3. Plan a process for meeting/communicating and working across functional and geographic boundaries. What communication channels does the team recommend to keep people talking across time and space? How will you deal with different cultural beliefs related to the concept of time, teamwork, authority, and the perception of deadlines? 4. Devise a list of deliverables and a timeline– take into account different time zones, formats, expectations, etc. How will you deal with different cultural beliefs related to the concept of time, teamwork, authority, and perception of deadlines? Submission Adhere to the current APA format and style as supported by Kaplan University. The paper should be double-spaced and at least five (5) written pages in length. Include a formal introduction and conclusion as well. Use at least three (3) outside peer review resources to validate your arguments.
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