Financial crisis? Answer

  1. Financial crisis? Answer
  2. The collapse of trading
  3. Easy credit conditions
  4. The fiscal policies
  5. The monetary policies
  6. The Federal Reserve responded to the crisis by lowering its major federal funds rate
  7. The fiscal stimulus and recession increased the government budget deficit.

 

Economies of scale refer to a situation where increasing output leads to decrease in per unit cost of production ? Answer

  1. Economies of scale refer to a situation where increasing output leads to decrease in per unit cost of production ? Answer
  2. Dis-economies of scale refer to a situation where the average cost of production increases along with increase in output
  3. From the value of market share in the three countries, we can see that the market share for country 3 is the highest.
  4. hypothetical situation
  5. The domestic price

 

What is the expression for MRTSL,K given this production function? Answer

  1. What is the expression for MRTSL,K given this production function? Answer
  2. Consider the production function Q=L1/2+K2.
  3. Does this production function exhibit diminishing marginal product of capital? Explain how
  4. Does this production function exhibit diminishing marginal product of labour? Explain how you
  5. Does this production function exhibit diminishing marginal rate of substitution (L for K)? Explain how you know

Final Exam List any bases Robins & Robins could sue Casings, Inc., under contract theory ONLY for the damages caused by the explosives in their drugs Answer

List any bases Robins & Robins could sue Casings, Inc., under contract theory ONLY for the damages caused by the explosives in their drugs Answer

 

1. List any bases Robins & Robins could sue Casings, Inc., under contract theory ONLY for the damages caused by the explosives in their drugs, over and above the cost of the capsule shells. (short answer question)

 
2. TCO B. The FDA discovers that, during the public comment process, Robins & Robins bribed one of the members of the administrative panel that decided to pull the rule from consideration. The member of the panel was removed and is being charged criminally. As a result, the FDA immediately implements an emergency order that puts into effect the “tracking bar” requirement and makes the rule retroactive, but only to Robins & Robins. Provide two arguments Robins & Robins can make to have the rule determined to be invalid under the Administrative Procedures Act. Explain your answer. (Points : 30)

 
3. TCO C. Robins & Robins immediately issued a massive recall for the tainted medication upon learning of the situation. Despite the recall, 1,400 children and 350 adults have been hospitalized after becoming very ill upon taking the tainted medication. Each of them had failed to note the recall after having already purchased the medication. It is quickly determined that they will need liver transplants and many of them are on a waiting list. During the wait, to date, 12 children have died. Their families are considering suing for both 402A and negligence. The attorneys stated that but for the lobbying efforts, the recall process would have been automated and the people would not have gotten sick or died.
You are the attorney for one of the dead children’s family. List the causes of action (if any) you would file against Robins & Robins, the FDA, and the bribed FDA member. List the elements of the causes of action, and set forth the facts that you have that would support a lawsuit against each of the three named defendants. State any defenses any of the three would have. Analyze the success of the defenses.

 

 
4.
TCO A. It is discovered that Robins & Robins knew about the tainted medication 2 months earlier than they announced the recall. They hid it and, in fact, sent out contract buyers to try to buy up all of the medication off the shelves. Their “fake” recall failed. Using the Blanchard and Peale method of analyzing ethical dilemmas, analyze the ethical dilemma faced by the CEO of Robins & Robins for the fact that they saved 35 cents/package and are now in the middle of a major, life-threatening recall. Analyze their “fake” recall as well. Show all of the steps of the model and give a recommendation to the CEO of what to do now that the deaths are escalating. What is the “right” thing for the CEO to do in this case?

 

 
5. TCO I. A Canadian citizen whose son (resident of Ontario) died from the medication sues Robins & Robins in a California court. The court there is well known for being victim friendly and providing huge payouts to victim families. In Canada, the cap on nonpecuniary damages is around $300,000. Punitive damages in Canada are rarely allowed. Robins & Robins moves to dismiss the case under the theory of sovereign immunity. Will Robins & Robins win this motion using this theory? Why or why not? (short answer question) (Points : 15)

 
Page2:
1.
TCO E. Pastor Forester claims his firing was illegal because it was based on his being a convicted felon. His contract with the school provides him with defense coverage for any acts he takes while working for the school. Anna and Lisa sue Pastor Forester and the school for sexual harassment and discrimination, and Pastor Forester requests the school pay for his defense. Discuss whether Anna and Lisa will be successful in their claim of sexual harassment and discrimination against the school and Pastor Forester. Discuss whether the school illegally fired Pastor Forester. Will the school have to pay for the pastor’s defense? Analyze and defend your answer.

(Points : 30)

 

 
2.
TCO H and E. In the discovery portion of the case, it is determined that Pastor Forester is really not a pastor. His real name is Jerry Birches, a parolee with convictions for child molestation. His parole agreement prohibits him being closer than 1,000 feet to any school. In order to cut costs, the school had stopped doing background checks on new employees, and this slipped through the cracks. The president of the board of directors immediately fires Pastor “Jerry Birches” Forester and notifies his parole officer of the violations. Pastor Forester claims the board knew about his background because one member of the board (his aunt Theresa) knew the truth. He claims her knowledge should be imputed to the entire board of directors.

 

 

 
Page 3:

1. TCO F. Men2Wimmin (M2W) sends a cease and desist letter to Clean Clothes (CC) demanding CC stop using M2W’s tagline, which is registered with the Trademark Office. Clean Clothes responds, stating that (a) CC’s tagline is different enough as not to violate the trademark, (b) CC didn’t know about M2W’s tagline so they couldn’t have copied it, and (c) Men2Wimmin has no damages and therefore can’t sue Clean Clothes. Analyze the case for Men2Wimmin, including the elements of any case they have, and explaining any defenses that Clean Clothes might raise against them. What damages can they request, and do you think they will get them? Why or why not? (Points : 30)

 

 

2. TCO G. It is discovered that 2 weeks before the Ellen show, her partner had sold $2 million in JOSB stock (at a gain of about $2,200). The morning after Ellen’s show, Ellen’s partner shorted the JOSB stock (which is a bet that the price will go down), and she made another $210,000 from that trade. The swing in the price was not 100% directly tied to Ellen’s comments, as JOSB had issued a recall of their white, long-sleeved shirts when they were found to have been sewed with brown thread, making them unwearable. Ellen’s partner’s previous trading activity shows that she made it a normal practice to “vigorously trade” the stock of any company with which Ellen did business. A review of her trading activity for the past year showed that she had bought and sold JOSB stock 25 different times. Further, she typically used “short” sales when companies had issues with their products. Do you think the SEC will file anything against Ellen or her partner for these sales of JOSB? Is there any cause to do so? Analyze the transactions with respect to insider trading activity (based on what you know) and whether Ellen or her partner should be concerned. Is the prior trading activity a defense? Analyze and explain fully. (Points : 30)

What is the cost of producing an additional car when 50 cars are being produced? Answer

  1. What is the cost of producing an additional car when 50 cars are being produced? Answer
  2. Graph the PPF, assuming that it has no curved segments.
  3. What is the cost of producing an additional car when 150 cars are being produced?
  4. What is the cost of producing an additional washing machine when 50 cars are being produced?
  5. When 150 cars are being produced?
  6. What do your answers tell you about opportunity costs?

 

 

“Fundamentals of Corporate Finance” Lesson5 Which of the following is the minimum return a company

“Fundamentals of Corporate Finance” Lesson5 Which of the following is the minimum return a company

1. Which of the following is the minimum return a company
needs to earn to satisfy all its investors?
A. NPV
C. BASF 2015
B. RE
D. WACC

2. The equation RP = D/P0 is used to determine the
A. cost of a bond.
B. cost of preferred stock.
C. cost of common stock.
D. dividend resulting from one share of stock.

3. The cost of equity can be viewed as the combination of
A. the financial leverage and the cost of capital.
B. corporate taxes and shareholder claims.
C. business risk and financial risk.
D. the weighted average cost of capital and the capital structure.

4. The return that lenders require on a firm’s new borrowing is known as the
A. financial leverage. C. warrant.
B. cost of debt.D. cost of equity.

5. The legal proceeding for liquidating or reorganizing a business is called
A. internal financing. C. flotation.
B. financial leveraging. D. bankruptcy.

6. When a firm places projects into one of several risk classes and adds or subtracts
adjustment factors to or from the WACC, the firm is using the _______ approach.
A. basic C. objective
B. subjectiveD. pure play

7. The dividend growth model approach is one approach to estimating a firm’s
A. cost of equity.C. conversion value.
B. financial leverage. D. beta coefficient.

8. A firm that pays few or no dividends and instead provides shareholders with
capital gains through an increase in stock values is called a
A. business failure. C. leveraged firm.
B. pure play. D. growth firm.
9. If a firm has publicly held debt and measures it cost as the yield to maturity on the
outstanding debt, the company rate is
A. critical. C. low.
B. (E/V) RE. D. irrelevant.

10. The cost of capital for a firm that has no debt is called the
A. weighted average cost of capital.
B. financial leverage.
C. interest tax shield.
D. unlevered cost of capital.

11. A procedure in which a failing firm is financially restructured in an attempt
to continue operations is called
A. liquidation. C. reorganization.
B. tax shielding. D. capital structuring.

12. Issuing stock and using the money to pay off debt is one way a firm
A. restructures. C. prepares for bankruptcy.
B. refinances. D. prepares for its IPO

13. In Wall Street language, a company that focuses on only one line of business
is called a(n)
A. pure play. C. growth firm.
B. unlevered company. D. internally financed firm.

14. The overall return that a company must earn on its existing assets to maintain thevalue of its stock and to satisfy its owners, creditors, and providers of capital is
called the
A. reorganization value.
B. flotation cost.
C. weighted average cost of capital.
D. capital structure.

15. During most cases, when a company files for bankruptcy,
A. the court assigns an unbiased individual to run the company in the interim.
B. the judge prepares a reorganization plan the company must follow.
C. payments to creditors and shareholders are suspended.
D. the “debtor in possession” runs the business.

16. The return that equity investors require on their investment in a firm is called the
A. cost of equity.
B. weighted average cost of capital.
C. capital structure weight.
D. project cost of capital.

17. When a firm raises money by issuing new stocks or bonds, the costs associated
with the new stock or bond issues are called the
A. intrinsic value. C. strike costs.
B. floor value. D. flotation costs.

18. The run establishing priority of claims during a liquidation is called the
A. reorganization priority list. C. absolute priority rule.
B. bankruptcy proceeding rule. D. prepack claims petition.

19. The separate cost of capital in each section of a corporation is called the
A. floor value. C. capital appreciation.
B. divisional cost of capital. D. option cost.

20. The situation in which a firm is unable to meet its financial obligations is called
A. technical insolvency.C. reorganization.
B. liquidation. D. accounting insolvency.