Internal rate of return

When it comes to insurance companies their main goal is correlate rates for policies as closely as possible with the actual cost of claims. The reason for this is because if the rate will be too high clients will move to other providers causing the company to lose market insurance or they will set the rates too low and cause them to lose money. So one tool that insurance companies use is credit scoring. The reason for this is because studies have shown that how a person manages their financial…

Founded in 1959, The Mertz Gilmore Foundation is a private, independent grant making institution that supports and promotes vibrant communities, the performing arts, and a sustainable environment (Mertz Gilmore Foundation1, n.d.). With an asset of approximately $100 million, its grant focuses on a small number of programs while maintaining relatively long-term commitments to its core areas of concern. The Mertz Gilmore Foundation has an extensive history of supporting dance in the city,…

Profit rate for a hotel is its net present value divided by its cost. Company Background Marriott Corporation began in 1927 with J. Willard Marriott's root beer stand. Over the next 60 years, the business grew into one of the leading lodging and food service companies in the United States. Marriott's 1987 profits were $223 million on sales of $6.5 billion. See Exhibit 1 for a summary of Marriott's financial history. Marriott had three major lines of business: lodging, contract services, and…

For example, if σ = 45% and ρ = 0.2, then the standard deviation with 50 stocks would be 20.91%, and would rise to 22.05% when only 20 stocks are held. Such an increase might be acceptable if the expected return is increased sufficiently. Hennessy could contain the increase in risk by making sure that he maintains reasonable diversification among the 20 stocks that remain in his portfolio. This entails maintaining a low correlation among the remaining stocks. For example, in part (a), with ρ = 0…

Whereby D1 = Expected dividend per share for the next year k = Required rate of return (can be estimated using the CAPM or Dividend Growth Model) g = Expected dividend growth rate • Multi-Stage Growth Model In cases where dividends are not expected to grow at a constant rate, the investor must evaluate every year’s dividend separately. However, this model does assume that dividend growth…

December 2013 showed by the attached excel, the annualized expected return, standard deviation and correlation of the two stocks are calculated and revealed. Using the result of the closing price minus the opening price to divide by the opening price can figure out the monthly returns during the 5 years in order to obtain the average monthly return. Then, the average monthly return time 12 months that can lead to the annualized return. Afterwards, the standard deviation applies the formula…

job training for the workers decrease production. The forest production division contains paperboard and timber plant. In the paperboard division, Missouri competitions designed new plants that created quality products at a low cost. This created no return on investment and declined profits. The cash flows for this sector would go negative for next six years. Consultants believed felt that the range for negative cash flows would be $100,000,000 to $125,000,000. This segment could be purchased…

methods. Whether it is OJT, an apprenticeship/internship, traditional lecture, online learning or simulations; training employees is crucial to organizational success. Sufficient funding should be placed in the training budget to ensure a satisfying return on investment (ROI). Through my adult life, I have encountered most, if not all of the methods of training that many organizations use today. Companies are in the business of making profits, and the cost of training is always a…

determined the formula best to use is the future value interest of an annuity stream. Of the 3 method’s, I prefer to use: FVIFA= FUTURE VALUE INTEREST FACTOR OF AN ANUNUITY PMT= CASH FLOW PAYMENT N= # OF PAYMENTS R= INTEREST RATE Now we can input our data into the formula to solve for the amount we will have in 17 years while depositing $3000.00 in an original annuity at 9.5% per year. The answer is: $116,140.50 at the end of 17 years CONTINUED… 1. 2. To answer…

The issue emerged on the grounds that the amplification of the company 's profits could genuinely debilitate its liquidity, and the quest for liquidity tended to weaken returns. This article assessed the relationship in the middle of conventional and option working capital measures and degree of profitability (return for money invested), particularly in mechanical firms recorded on the Johannesburg Stock Trade (JSE). The issue under scrutiny was to make whether the all the more as of late…