Preparing strategy for the fall season

Assignment Help Financial Management

Reference no: EM131085661

Allison’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. Expand Wool Sweaters Line Enter Cashmere Sweaters Line Expected Sales Probability Present Value of Cash Flows from Sales Probability Present Value of Cash Flows from Sales Fantastic .2 $ 206,000 .4 $ 389,000 Moderate .5 180,000 .3 277,000 Low .3 94,300 .3 0 The initial cost to expand the wool sweater line is $165,000. To enter the cashmere sweater line, the initial cost in designs, inventory, and equipment is $159,000.

a. Calculate net present value if, Allison’s Dresswear Manufacturers decides to: (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to the nearest whole dollar)

Net Present Value Expand wool sweaters line $

Enter cashmere sweaters line $

Reference no: EM131085661

Questions Cloud

Goal format to further develop those goals : Use the S.M.A.R.T Goal format to further develop those goals. (this is where I'd copy the exemplar from VIP2, but only the piece that shows this particular step)

Determining the leaders vs managers : Please complete ONE of the following assignments, incorporating ideas and concepts from the week's lecture and/or articles. Please feel free to incorporate outside resources as well. When submitting your assignment, please indicate which of the th..

Calculate the theoretical intrinsic value of the call option : Given the following information, calculate the theoretical intrinsic value of the Call option using the Black Scholes Model. IF the market price for the Call option = $11, should the investor buy?

Flue gas desulfurization : Review the Reading Assignment titled as "Flue Gas Desulfurization: The State of the Art" by Srivastava and Jozewicz. In your review:

Preparing strategy for the fall season : Allison’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 desig..

Develop a problem-based strategy for creating : CE00882-4 Develop a problem-based strategy for creating and applying programmed solutions using an object-oriented paradigm - Use an object-oriented development environment in the development, testing and debugging of an object-oriented application.

Advantages of using this source of recruitment : Now the post of supervisor is vacant and no one can be transferred or promoted to this post. Name the source of recruitment the company will use to fill up this post. Give three advantages of using this source of recruitment.

Concepts from the background readings : For this assignment you will be applying the concepts from the background readings to some specific scenarios that you might face if you were a leadership development coach. Make sure to thoroughly review Wilson (2014) and Taylor, et al. (2008) be..

Determined statistical tables based on standard deviations : When returns from a project can be assumed to be normally distributed, such as those shown in Figure 13-6 (represented by a symmetrical, bell-shaped curve), the areas under the curve can be determined from statistical tables based on standard deviati..

User Account

All Pages