Compute the cofficient of variation of annual cash flows

Assignment Help Financial Management
Reference no: EM131337439

Mitchell Auto Parts, Inc. has estimated the probability distribution of its annual net cash flows as follows:

Probability

Cash Flow

(in Thousands of Dollars)

0.10

$ 1,000

0.20

1,500

0.40

2,000

0.20

2,500

0.10

3,000

a. Compute the expected annual cash flow.

b. Compute the standard deviation of annual cash flows.

c. Compute the cofficient of variation of annual cash flows.

Reference no: EM131337439

Questions Cloud

Compare kubler-ross stages of death and dying : Compare and contrast Kubler-Ross' stages of death and dying, and Worden's task of mourning. Which model would you use, and why? Would there ever be a time that you would use both models to help a person out, and why
Description of your three potential research topics : A brief description of your three potential research topics. A list of hypotheses identified from 3 peer-reviewed research articles. Be sure to submit a link to or a copy of each article to your instructor, along with your paper
Why individuals and organizations purchase insurance policy : Will all individuals apply the same certainty equivalent estimates to the cash flows from a project? Why or why not?
What is the heat flux at the plate surface : If a third plate, 20 mm thick, is suspended midway between the original plates, what is the surface heat flux for the original plates? Assume the temperature and flowrate of the gas to be unchanged and radiation effects to be negligible.
Compute the cofficient of variation of annual cash flows : Compute the expected annual cash flow.- Compute the standard deviation of annual cash flows.- Compute the cofficient of variation of annual cash flows.
Manager and leader in a diverse organization : You are a manager and leader in a diverse organization (McDonald's)  that includes locations in many other countries. You are asked to create a presentation to share your experiences regarding leadership
Determine the heat transfer rate from the duct to the air : Determine the heat transfer rate from the duct to the air and the air outlet temperature.
Entrenched competitor as blockbuster : How did Netflix succeed against such a large and entrenched competitor as Blockbuster? (Address the weaknesses Netflix exploited and the new capabilities it developed in response to customer needs.)
Estimate the operating temperature of the board : Atmospheric air at a volumetric flow rate of 0.060 m3/s and 27°C is drawn through the sinks by a blower. Estimate the operating temperature of the board and the pressure drop across the sinks.

Reviews

Write a Review

Financial Management Questions & Answers

  What is equivalent annual annuity for each machine

The Perez Company has the opportunity to invest in one of two mutually exclusive machines. Machine A costs $10 million but realizes after-tax inflows of $4 million per year for 4 years. After 4 years, the machine must be replaced. What is the equival..

  What will be your monthly payment

You plan to buy a new car. The price is $30,000 and you will make a down payment of $4,000. Your annual interest rate is 10% and you intend to pay for the car over five years. What will be your monthly payment?

  Problem leverage-long-term debt-equity ratio

A firm has a long-term debt-equity ratio of .4. Shareholders’ equity is $1 million. Current assets are $200,000, and the current ratio is 2. The only current liabilities are notes payable. What is the total debt ratio?

  What is the realized compound yield during the four years

what are the yield to maturity and the yield to call of a 20 year, 8% bond that is selling for $1150 has a call value of $1100 in year 6? Which will the investor make? We buy a 15 year, 10% bond yielding 9%. We sell it after 4 years when market rates..

  Best financial practices

List at least five “Best financial practices” that are important for the healthcare organizations to follow. Base your choice on your reading in this course and research. Explain why each of these practices is important for healthcare organizations.

  Bond currently sells-what is the duration of bond

A bond currently sells for $1,110, which gives it a yield to maturity of 5%. Suppose that if the yield increases by 25 basis points, the price of the bond falls to $1,065. What is the duration of this bond?

  List the basic steps in static gap analysis

List the basic steps in static GAP analysis. What is the objective of each?

  Confidence interval is constructed-population mean revenue

The daily revenue from the sale of fried dough at a local street vendor in Boston is known to be normally distributed with a known standard deviation of $120. The revenue on each of the last 25 days is noted, and the average is computed as $550. A 95..

  What is ratio analysis

What is ratio analysis? Also briefly describe the three basic categories or ways that ratio analysis is used.

  Calculate the market capitalization rate

Miltmar Corporation will pay a year-end dividend of $3, and dividends thereafter are expected to grow at the constant rate of 4% per year. The risk-free rate is 5%, and the expected return on the market portfolio is 14%. The stock has a beta of 0.82...

  At what contract price will you get a margin call

On Friday, December 12, the March 2016 S&P Index futures contract (i.e., the S&P contract which expires in March of next year) closed at 2000, down 40 points on the day. The value of the contract is set at 250 × the index. How much value did each con..

  What was the firms 2012 operating cash flow or ocf

The 2011 balance sheet of Anna's Tennis Shop, Inc., showed long-term debt of $6.4 million,-What was the firm's 2012 operating cash flow, or OCF?

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