Investment You have inherited
Note: For a one-time play (investment), you would split your investment proportional to the entries in your optimal strategy matrix. Assume that fate is a very clever player. Then if fate deviates from its optimal strategy, you know you will not do any worse than the value of the game, and you may do better.
Want to see the full answer?
Check out a sample textbook solutionChapter 11 Solutions
Finite Mathematics for Business, Economics, Life Sciences and Social Sciences
Additional Math Textbook Solutions
Excursions in Modern Mathematics (9th Edition)
A Survey of Mathematics with Applications (10th Edition) - Standalone book
Probability and Statistics for Engineers and Scientists
Mathematics with Applications In the Management, Natural, and Social Sciences (12th Edition)
Using & Understanding Mathematics: A Quantitative Reasoning Approach (7th Edition)
Calculus for Business, Economics, Life Sciences, and Social Sciences (13th Edition)
- Investment Analysis You have $5000 to invest for 1 year. Fund A has an estimated 4% annual return, and Fund B has an estimated 10% annual return. Fund A is more stable, and preferred among investors with low risk tolerance. Fund B is less stable, but has larger returns. Answer the following questions about this investment opportunity. Suppose you have a high risk-tolerance, and you invest everything in Fund B. How much do you expect to make on your investment? $ . Round to the nearest cent.arrow_forwardSwain Athletic Gear (SAG) operates six retail outlets in a large Midwest city. One is in the center of the city on Cornwall Street and the others are scattered around the perimeter of the city. Management at SAG is concerned about declining sales and profitability of the Cornwall store and believes that outlet has been a drag on profits in recent years. The most recent income statement for the Cornwall store follows. SWAIN ATHLETIC GEAR Cornwall Street Store Income Statement For the Year Ending February 28 Sales revenue $ 12,300,000 Costs Cost of goods sold $ 5,289,000 Advertising 1,421,000 Store administrative salaries 975,000 Sales commissions 1,056,000 Leases and utilities 2,100,000 Allocated corporate support 1,622,000 Total costs $ 12,463,000 Net loss before tax benefit $ (163,000) Tax benefit at 25% (40,750) Net loss $ (122,250) The CFO at SAG has asked for your advice on closing the Cornwall Street store. If the Cornwall Street store is…arrow_forwardConn Man's Shops, a national clothing chain, had sales of $450 million last year. The business has a steady net profit margin of 9 percent and a dividend payout ratio of 30 percent. The balance sheet for the end of last year is shown. Cash Accounts receivable Inventory Plant and equipment Total assets Assets Balance Sheet End of Year (in $ millions) $ 43 64 94 $ 186 Required new funds $ 387 $ Liabilities and Stockholders' Equity The firm's marketing staff has told the president that in the coming year there will be a large increase in the demand for overcoats and wool slacks. A sales increase of 20 percent is forecast for the company. Accounts payable Accrued expenses Other payables Common stock Retained earnings Total liabilities and stockholders' equity All balance sheet items are expected to maintain the same percent-of-sales relationships as last year,* except for common stock and retained earnings. No change is scheduled in the number of common stock shares outstanding, and…arrow_forward
- You have $5000 to invest for 1 year. Fund A has an estimated 4% annual return, and Fund B has an estimated 10% annual return. Fund A is more stable, and preferred among investors with low risk tolerance. Fund B is less stable, but has larger returns. Answer the following questions about this investment opportunity. Suppose you have a high risk-tolerance, and you invest everything in Fund B. How much do you expect to make on your investment? $ . Round to the nearest cent. Thanks appreciate it!arrow_forwardInvestment A woman has $1,400,000 to purchasethree investments. One investment earns 8%, asecond earns 7.5%, and the third earns 10%.a. What investment strategies will give annual earnings of $120,000 from these three investments?b. What one investment strategy will minimize herrisk and return $120,000 if the 10% investmenthas the most risk?arrow_forwardAn efficient portfolio_________: Multiple Choice: A) has no risk at all. B) provides the highest expected return for a given level of risk. C) has only unique risk. D) provides the highest expected return for a given level of risk and provides the least risk for a given level of expected return.arrow_forward
- A local club plans to invest $10000 to host a baseball game. They expect to sell tickets worth $15000. But if it rains on the day of game, they won't sell any tickets and the club will lose all the money invested. If the weather forecast for the day of game is 20% possibility of rain, is this a good investment? * $2000. So, it's a good investment None of the choices. O $2000 . So, it's a bit risky. $200. So, it's a good investmentarrow_forwardMANAGING YOUR MONEY. You have excess cash. You anticipate that you will need to have 1 year (12 months) worth of expenses covered. You want to make sure that you can have access to your cash, but also gain interest as well, throughout the 12 months. Your expenses are $3000 per month. You have $30,000 in cash. You want to put it in various accounts or funds for: 1 month, 3 months, 6 months, and 12 month. The remaining amounts you want going to something that will earn you the highest interest. How would you allocate them in various accounts (checking, NOW, savings, MMDA, CDs, T-Bills, Mutual funds, brokerage accounts, asset management accounts), in order to manage your liquidity (have access to your money and still gain interest)?arrow_forwardDay traders typically buy and sell stocks (or other investment instruments) during the trading day and sell all investments by the end of the day. The following table shows the closing prices on September 22, 2015, of 12 stocks selected by your broker, Prudence Swift, as well as the change that day. Tech Stocks Close Change AAPL (Apple) $113.40 -1.81 ADBE (Adobe Systems) $84.66 1.34 EBAY (eBay) $25.61 -0.31 MSFT (Microsoft) $3.90 -0.21 S (Sprint) $4.40 0.02 WIFI (Boingo Wireless) $8.51 0.56 Non-Tech Stocks ANF (Abercrombie & Fitch) $21.81 -0.02 в (Воeing) $133.99 -2.03 F (Ford Motor Co.) $13.91 -0.40 GE (General Electric) $25.10 0.01 GIS (General Mills) $57.12 0.33 JNJ (Johnson & Johnson) $93.26 0.13 On the morning of September 22, 2015, Swift advised you to purchase a collection of three tech stocks and two non-tech stocks, all chosen at random from those listed in the table. You were to sell all the stocks at the end of the trading day. (a) How many possible collections are possible?…arrow_forward
- Investing: Inverse ETFS (Exchange Traded Funds) Inverse ETFS, sometimes referred to as "bear market" or "short" funds, are designed to deliver the opposite of the performance of the index or category they track, and so can be used by traders to bet against the stock market. The following table shows the performance of three such funds as of August 5, 2015.+ Year-to-Date Loss (%) MYY (ProShares Short Midcap 400) 6 SH (ProShares Short S&P 500) REW (ProShares UltraShort Technology) You invested a total of $14,000 in the three funds at the beginning of 2011, including an equal amount in SH and REW. Your year-to-date loss from the first two funds amounted to $560. How much did you invest in each of the three funds? MYY 24 SH $ REW 24arrow_forwardMONOLOGIER Billy-Sean O'Hagan is the treasurer at his college fraternity, which recently earned $14,450 in its annual carwash fundraiser. Billy- Sean decided to invest all the proceeds in the purchase of three computer stocks: HAL, POM, and WELL. Price per Share ($) Dividend Yield (%) HAL POM WELL 100 20 25 shares shares shares 0.5 1.50 AGE 0 If the investment was expected to earn $63 in annual dividends and he purchased a total of 220 shares, how many shares of each stock did he purchase? HAL POM WELLarrow_forwardScenario. Much like the decision to start a business, the decision to attend college is fraught with risk; however, the risk of entering the job market with only a high school diploma is just as great. As the U.S. transformed from a manufacturing-based economy to an economy based on knowledge, high school graduates are often unable to obtain the number of high-paying jobs that were once available. College graduates earn more-some suggest as a much as 60% more over a lifetime than those without a college degree, and have a lower divorce rate, lower blood pressure and stress levels, and higher rates of job stability and satisfaction. However, a college education may not be the right choice for some. There may be a glut of college-educated workers in our workforce, and many careers, including those in cosmetology, do not require a college degree. The U.S. Department of Labor projects jobs for hairdressers, hairstylists, cosmetologists, and skin care specialists to grow 9-17% through the…arrow_forward
- Calculus For The Life SciencesCalculusISBN:9780321964038Author:GREENWELL, Raymond N., RITCHEY, Nathan P., Lial, Margaret L.Publisher:Pearson Addison Wesley,