Deck 5 Mix Flashcards

1
Q

When is NPV better than IRR

A

when cash inflows and outlfows alternate diff amounts because irr is a % and npv is a $

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2
Q

residual income

A

assetsimputed rate-salessales return

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3
Q

when is a spin off best?

A

fresh start,

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4
Q

total cost savings calc

A

initial cost-cost savings

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5
Q

how are days in AR calculated?

A

% of daily sales taken discount vs % of daily sales no dicount multiply each by days outstanding 10 days and 30 days. dont factor in discount

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6
Q

how is pre-tax profit calculated?

A

after tax profit/(1-tax rate)

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7
Q

CM ratio*SP=

A

cm per unit

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8
Q

how are unit sales calculated to get break even sales with a desired profit

A

take fixed costs+target sales/cmperunit

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9
Q

in what markets are perfect flat, horizontal demand curves?

A

perfect competition-price takers,not setters
perfect competition has no entry or exit barriers

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10
Q

how is an oliogopoly doffernt from monopolistic?

A

ensure differntiation and adjust volume where monopolistic plans for differntiation

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11
Q

strategic planning begins with…

A

defining mission and vison, then sets goals before the plan is started

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12
Q

benefits to JIT

A

cost reduction
Reduced WIP
quality imporvement

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13
Q

why would a company offer a 2/10 net 30 discount?

A

to increase its cash and/or keep up with competetors

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14
Q

what type of asset/debt mix poses the greatest risk?

A

permenet current assets
w/ short term debt bc it does not show a company being able to pay off its debts when st

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15
Q

what factors affect safety stock?

A

lead time, uncertainty levels in shipment delay, customer dissatisfaction,

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16
Q

how is the binomial cox method differnt than black scholes

A

can be modified over time and pays dividends without modification.

17
Q

what produces less and charges more?

A

monopolistic