Finding a time series of sales

Assignment Help Finance Basics
Reference no: EM132764585

Then create time series of the company sales, whereby you use a) the assumption of non-correlated commodity proces and sales,  which would in real life reflect situation of fixed negotiated sales contracts with buyers (that means that in all simulated scenarios sales will amount to USD 650 mln); and b) assumption of correlation coefficient of 0.8 to the selected commodity, which would in real life reflect situation where some commodity price pass-through to buyers is possible - please note that simulated sales will not all the time be USD 650 mln (hint: consult literature about how to create correlated time-series ).

Hint: Starting from commodity price, finding a time series of sales is just the opposite as in real life, where one starts from sales and then studies the relationship between sales and costs of materials. Under b), make also assumption that correlation coefficient is 0.9 (not only 0.8).

Reference no: EM132764585

Questions Cloud

Determine Swindler basis in each distributed asset : Swindler's basis in his partnership interest before the distribution is $69,000. Determine Swindler basis in each distributed asset
What will be the final payoff : which also expires today, what will be the final payoff? What is this combination called?
What is the sensitivity to the portfolio : A portfolio manager wants to make simple portfolio from only two stocks, Y and Z. The returns for stocks Y and Z are given by the following equations
What is the sensitivity to the portfolio : What is the sensitivity to the portfolio of a 1% rise in inflation?
Finding a time series of sales : Then create time series of the company sales, whereby you use a) the assumption of non-correlated commodity proces and sales,
Discuss the potential risks associated with internal control : Start the report from five general risks involved in the revenue cycle of any business. Further, indicate the physical and IT control against each risk
What is the net realizable value of SKY accounts receivables : Sales returns related to 2018 sales, P30,000, were received on January 2, 2019. What is the net realizable value of SKY accounts receivables
Find the total capital repaid and interest paid : A loan of £10.000 is to be repaid by equal monthly instalments in arrears over 10 years. The amount of the monthly payment is calculated
Calculate liquidation value of boti ltd : Due current economic uncertainty, the owners of BoTi ltd have decided to sell their business and to value it using the liquidation approach.

Reviews

Write a Review

Finance Basics Questions & Answers

  Rationale for the contemporary management

Rationale for the contemporary management technique selected. In-depth analysis of the technique, in which you fully describe the technique, its implementation process, its application by other organizations, its applicability to your organization/..

  Money for your two dream vacations

You want to save some money for your two dream vacations as well as have some money available during your retirement years. Today is your 35th birthday.

  What will the company ending cash balance be

Analyzing a statement of cash flows) A company has cash from operating activities of $220, cash from investing activities of ($93), cash from financing.

  Current spot rate of the pound

Using the value-at-risk (VaR) method based on a 95 percent confidence level, what is the maximum one-month loss in dollars if the expected percentage

  Computing the npv of the investment

Marsha Jones has bought a used Mercedes horse transporter for her Connecticut estate. It cost $42,000. The object is to save on horse transporter rentals.

  Differences between an ordinary annuity and an annuity due

Additionally, in your discussion, describe how the present value and the future value of an annuity is calculated (use diagrams if it helps your discussion).

  Estimating depreciation due to ppp

Assume that St = 1.30 GBPUSD. How will this spot rate adjust after one year according to PPP if the United Kingdom experiences an inflation rate

  Explain diversification

Use the following table to answer the question. Boom Normal Recession 20% 40% 20% Probability $30 mil $20 mil $10 mil CF (Wegmans $20 mil $20 mil $20 mil CF (Firm A) $60 mil $40 mil $20 mil CF (Firm B) $15 mil $10 mil 5 mil CF (Firm C) $20 mil $10..

  What is the project''s expected npv if the tax is imposed

The project has a 12 percent cost of capital. Assume at the outset that the company does not have the option to delay the project. Use decision tree analysis to answer the following questions. What is the project's expected NPV if the tax is imposed?

  Stock price and market capitalization

Suppose Cisco Systems pays no dividends but spent 5 billion dollars on share repurchase last year. What stock price does this correspond to?

  What are three real options that an analyst

What are three real options that an analyst may need to take into account when evaluating a project, and what do they allow the company

  Margin required to hold a futures contract

The margin required to hold a futures contract is not a down payment but a form of security bond.  What will be your comments on this?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd