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- Jasmine's Dresswear Manufacturers is preparing a strategy for the fall season. One alternative is to expand its traditional ensemble of wool sweaters. A second option would be to enter the cashmere sweater market with a new line of high-quality designer label products. The marketing department has determined that the wool and cashmere sweater lines offer the following probability of outcomes and related cash flows: Expected Sales Expand Wool Sweaters Line Enter Cashmere Sweaters Line Probability Present Value of Cash Flows from Sales Probability Present Value of Cash Flows from Sales Fantastic 0.3 $ 190,000 0.4 $311,000 Moderate 0.3 188,000 0.1 245,000 Low 0.4 85,600 0.5 0 The initial cost to expand the wool sweater line is $135,000. To enter the cashmere sweater line, the initial cost in designs, inventory, and equipment is $142,000. a. Calculate net present value if, Jasmine's Dresswear Manufacturers decides to: Note: Negative amounts should be indicated by a minus sign. Do not round…Karamo's Shoe Stores Incorporated is considering opening an additional suburban outlet. An aftertax expected cash flow of $100 per week is anticipated from two stores that are being evaluated. Both stores have positive net present values. Site A Site B Probability Cash Flows Probability Cash Flows 0.2 $ 50 0.1 $ 20 0.2 100 0.2 50 0.2 110 0.2 100 0.4 120 0.2 150 0.3 190 Compute the coefficient of variation for each site. Note: Do not round intermediate calculations. Round your answers to 3 decimal places. Which store site would you select based on the distribution of these cash flows? Use the coefficient of variation as your measure of risk. multiple choice Site A Site BKaramo's Shoe Stores Incorporated is considering opening an additional suburban outlet. An aftertax expected cash flow of $100 per week is anticipated from two stores that are being evaluated. Both stores have positive net present values. Probability 0.2 0.4 0.2 0.1 Site A Site A Site B Cash FlowS Coefficient of Variation $ 50 100 0.106 110 150 Probability 0.1 0.2 0.4 0.2 0.1 a. Compute the coefficient of variation for each site. Note: Do not round intermediate calculations. Round your answers to 3 decimal places. Site B Cash Flows $20 50 100 150 180
- Karamo's Shoe Stores Incorporated is considering opening an additional suburban outlet. An aftertax expected cash flow of $100 per week is anticipated from two stores that are being evaluated. Both stores have positive net present values. Site A Probability 0.2 0.2 0.2 0.4 Site A Site B Cash Flows $50 100 110 120 Coefficient of Variation Site B Probability 0.1 0.2 0.2 0.2 0.3 a. Compute the coefficient of variation for each site. Note: Do not round intermediate calculations. Round your answers to 3 decimal places. Cash Flows: $ 20 50 100 150 190Kyle's Shoe Stores Inc. is considering opening an additional suburban outlet. An aftertax expected cash flow of $130 per week is anticipated from two stores that are being evaluated. Both stores have positive net present values. Site A Probability Cash Flows 0.2 0.1 Site A Site B 130 190 Coefficient of Variation Site A O Site B Site B Probability Cash Flows 0.1 a. Compute the coefficient of variation for each site. (Do not round intermediate calculations. Round your answers to 3 decimal places.) 0.3 0.2 0.2 130 160 190 b. Which store site would you select based on the distribution of these cash flows? Use the coefficient of variation as your measure of risk. SACH********Karamo's Shoe Stores Incorporated is considering opening an additional suburban outlet. An aftertax expected cash flow of $160 per week is anticipated from two stores that are being evaluated. Both stores have positive net present values. Probability 0.2 0.2 0.3 0.3 Site A Site B Site A Cash Site A O Site B FlowS $ 70 160 170 210 Probability 0.1 0.2 0.2 0.4 0.1 a. Compute the coefficient of variation for each site. Note: Do not round intermediate calculations. Round your answers to 3 decimal places. Site B Coefficient of Variation Cash FlowS $ 50 80 160 210 230 b. Which store site would you select based on the distribution of these cash flows? Use the coefficient of variation as your measure of risk.
- Karamo's Shoe Stores Incorporated is considering opening an additional suburban outlet. An aftertax expected cash flow of $120 per week is anticipated from two stores that are being evaluated. Both stores have positive net present values. Probability 0.2 0.2 9.4 0.2 Site A Site B Site A Cash Flows $ 70 Site A Site B 120 130 150 Coefficient of Variation Probability 0.1 0.2 9.2 0.4 0.1 Site B a. Compute the coefficient of variation for each site. Note: Do not round intermediate calculations. Round your answers to 3 decimal places. Cash Flows $ 40 79 120 140 220 b. Which store site would you select based on the distribution of these cash flows? Use the coefficient of variation as your measure of risk.Risk and return to investment: a buyer for a department store must decide whih designs the stores will carry before he knows what the demand will be in the coming season. The designs, A and B, have the following probability of succeeding and their associate costs with failure. The cost of the initial investment is $30,000. Design A: probability of success (0.80), with a pay-off from success ($90,000), and cost from failure ($50,000). Design B: Probability of success (0.70), pay-off from success ($70,000), and cost from failure ($10,000) Which design should the department store choose based on the expected value of the net benefit? state the expected net return to the project and show work.Karamo's Shoe Stores Incorporated is considering opening an additional suburban outlet. An aftertax expected cash flow of $100 per week is anticipated from two stores that are being evaluated. Both stores have positive net present values. Probability 0.2 0.2 0.2 0.4 Site A Site B Site A Cash Flows O Site A O Site B $50 100 110 120 Coefficient of Variation Probability 0.1 0.2 0.2 0.2 0.3 a. Compute the coefficient of variation for each site. Note: Do not round intermediate calculations. Round your answers to 3 decimal places. Site B Cash Flows $20 50 100 150 190 b. Which store site would you select based on the distribution of these cash flows? Use the coefficient of variation as your measure of risk.
- Quentin's Shoes manufactures urban chic footwear from recycled tires. In order to upgrade its efficiency, it is evaluating an equipment purchase which requires an expense of $463 today followed by cash returns of $190 in year one, $212 in year two, and $307 in year three. What is the net present value of these cash flows to the nearest cent if the discount rate is 3%?Last year, a marketing study costing $40,000 was done on the feasibility of a new instant dry nail polich. You are now tasked with estimating the cash flows for this project and will ultiamtely make an accept or reject decision. Which of the following is true? This is an externality and should be included This is an externality and should not be included This is an opportunity cost and should be included This is an opportunity cost and should not be included This is an sunk cost and should be included This is an sunk cost and should not be includedSpencer Enterprises is attempting to choose among a series of new investment alternatives. The potential investment alternatives, the net present value of the future stream of returns, the capital requirements, and the available capital funds over the next three years are summarized as follows: Develop and solve an integer programming model for maximizing the net present value. Assume that only one of the warehouse expansion projects can be implemented. Modify your model from part (a). Suppose that if test marketing of the new product is carried out, the advertising campaign also must be conducted. Modify your formulation from part (b) to reflect this new situation.
