• Q : Evaluate the var in a historical simulation....
    Finance Basics :

    National Bank Asia wants to hire fresh young graduates to work in their Market Risk Management department. As you are preparing your interview, you need to understand some key questions,

  • Q : Explain importance of operational risk....
    Finance Basics :

    Explain why operational risk is important. Though the cost of implementing a new operational risk management system is expensive, determine why it could also improve the efficiency of financial instit

  • Q : Explain the duration model....
    Finance Basics :

    You have been freshly hired and your line manager is asking you to use the duration model in order to assess the interest rate risk related to the loan portfolio.

  • Q : Determine bootstrap financing....
    Finance Basics :

    What is bootstrap financing it? Why don't all firms use bootstrap financing? Are there any dangers with this approach? What are the benefits of having some financial slack

  • Q : Determine the long position gain or loss....
    Finance Basics :

    Greg recently inherited a large, family-run farm that primarily produces grain for harvest each year. Greg has recently been researching the use of futures contracts to improve his returns on his crop

  • Q : Preparing a loan application....
    Finance Basics :

    The CEO of Smartphone Apps, LLC is preparing a loan application. Using the data below (only), prepare an Income Statement. Within this Income statement, include totals for Gross Margin,

  • Q : Threats for financial environment of healthcare organization....
    Finance Basics :

    What trends or threats are or will impact the financial environment of healthcare organizations? These may include legislative changes, lack of primary care providers, or changing demographics.

  • Q : Comparing a capitated environment....
    Finance Basics :

    Comparing a capitated environment to a fee-for-service environment; in a capitated environment:

  • Q : Determine dollar amount of the maintenance margin....
    Finance Basics :

    An American company sells yen futures contracts to cover possible exchange losses on its export orders denominated in Japanese yen. The amount of the initial margin is $20,000, and the maintenance mar

  • Q : Overemphasis on short-term and long-term profits....
    Finance Basics :

    Managers should not focus on the current stock value because doing so will lead to overemphasis on short-term profits at the expense of long-term profits.

  • Q : Calculating real cost....
    Finance Basics :

    A US company negotiated a forward contract to buy 100,000 British pounds in 90 days. The company was supposed to use the £100,000 to buy British supplies.

  • Q : Calculating insurance costs....
    Finance Basics :

    Marisa has a policy with replacement cost coverage and 80% co-insurance, and has a loss of $100,000 on her house. The replacement cost is $400,000 and the total policy coverage is $300,000. 

  • Q : Estimate precise tradeoffs....
    Finance Basics :

    In a tradeoff between two decision criteria such as ease of commuting and attractiveness of job, can you use money as a common denominator to estimate precise tradeoffs?

  • Q : Calculation of unit costs....
    Finance Basics :

    Cordoba Plc has the selling price of £25 per unit, direct material cost of £10 per unit, direct labour cost £6 per unit & variable overheads of £4 per unit. It has a fixed

  • Q : Prepare a table showing the development of initial portfolio....
    Finance Basics :

    One way to diversify your portfolio is to invest in the mutual funds. A mutual fund is a professionally managed type of collective investment that pools money from many investors to buy stocks, bonds,

  • Q : Evaluation of international investments....
    Finance Basics :

    International investment is a prudent part of any investment portfolio. International investment helps to diversify the investment portfolio. Although, international investments are beneficial, they a

  • Q : Determine external funding requirement....
    Finance Basics :

    Your company, Martin Industries, Inc., has experienced a higher than expected demand for its new product line. The company plans to expand its operation by 25% by spending $5,000,000 for an additional

  • Q : Implications of a change in the return on equity....
    Finance Basics :

    How does the degree of operating and financial leverage change the profitability of the firm when sales levels change significantly. Use examples and explain your answers?

  • Q : Determine firm fundamental, or intrinsic value....
    Finance Basics :

    Edmund Enterprises recently made a large investment to upgrade its technology. Although these improvements won't have much of an impact on performance in the short run, they are expected to reduce fut

  • Q : Calculate the value of a preferred stock....
    Finance Basics :

    You are trying to calculate the value of a preferred stock you are examining. This preferred stock has an annual dividend of $5 per share and a par value of $30.

  • Q : How the liquidity risk affects business risk....
    Finance Basics :

    Financial risk relates to the business debt, which may be incurred by business operations, but business risk is independent of the debt of the business."

  • Q : Social security benefits....
    Finance Basics :

    As retirees look to squeeze the most from their Social Security benefits, financial firms and advocacy groups are offering more advice on maximizing payouts.

  • Q : Find the u.s. trade in goods and services....
    Finance Basics :

    The United States exported almost $2 trillion worth of goods and services in 2010 yet realized a trade deficit of more than $500 million, meaning it imported more than it exported.

  • Q : Evaluating retirement plan....
    Finance Basics :

    Peggy gets paid every other week (bi-weekly) and her husband Patrick gets paid monthly. Peggy is going to make a $150 deposit from her paycheck every two weeks into a new retirement fund,

  • Q : Determine the fixed plant capacity....
    Finance Basics :

    My group is about to start a new company that will enter the international microcomputer business. In order to get our new company off the ground, the members of the executive team,

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