Homework Answers
SOLUION
ANSWER FOR THE FOLLOWING PROBLEM IS (B)
i.e NPV WOULD BE LOWER.
NPV WOULD BE LOWER IF INSTALLATION COST INCREASES AND PREMIUM SAVINGS DECREASES.
THE DECREASE IN THE PREMIUM SAVINGS WILL RESULT IN THE REDUCTION OF AFTER TAX CASH FLOWS. EVENTUALLY THE PRESENT VALUE OF FUTURE CASH FLOWS WILL ALSO GET REDUCED.
SEE FOLLOWING REPRESENTATION:
A = PRESENT VALUE OF CASH FLOWS
B = COST OF PROJECT
THEN, NPV = A - B
IF "A" DECREASES NPV DECREASES.AND VICE-VERSA.
IF "B" INCREASES NPV DECREASES AND VICE-VERSA.
Add Answer to:
Chapter 7: Selecting and implementing Risk Management Homework . Due in 5 days $100,000 Installation costs...
Chapter 7: Selecting and implementing Risk Management Homework . Due in 5 days gement T... 7/11...
Chapter 7: Selecting and implementing Risk Management Homework . Due in 5 days gement T... 7/11 answered ELE --------- - - to perform present value computations. Key Concepts 7.3 Homework • Unanswered In the calculation of the present value of $500,000 available in five years presented above, how would the present value change it the interest rate was increased from 8 percent to 10 percent? A the present value would be lower the present value would be higher resent value...
Chapter 7: Selecting and implementing Risk Management Homework . Due in 5 days Key Concepts 7.8...
Chapter 7: Selecting and implementing Risk Management Homework . Due in 5 days Key Concepts 7.8 Homework – Unanswered Which of the following is NOT a situation where self-insurance would normally make sense for a business? A The business has faced some financial challenges and has low cash levels The business has a relatively large number of similar exposures and the potential for simultaneous destruction is low 0 C The business has access to relatively good data on the past...
Chapter 7: Selecting and implementing Risk Management T... Homework . Due in 5 days 4/11 answered...
Chapter 7: Selecting and implementing Risk Management T... Homework . Due in 5 days 4/11 answered Key Concepts 7.9 Homework . Unanswered Which one of the following situations would represent a case of "natural hedging"? O A A firm buys insurance to cover loss due to windstorm damage O B A business rents vacation homes on the beach and runs a store that sells ice cream to beach visitors O C A farmer grows two crops, one does well in...
Chapter 7: Selecting and implementing Risk Management... Homework . Due in 5 days 4/11 answered 8....
Chapter 7: Selecting and implementing Risk Management... Homework . Due in 5 days 4/11 answered 8. Lapses in due diligence relating to mergers and acquisitions 9. Counterparty reliability in financial hedges 10. Spoilage or crop disease causing damage to the quantity, quality or marketability of grain supplies Source: Willis Group Assigned as Homework O Discussion Question The adoption of ERM has become much more common in firms of all types including hospitals. What do you think are three non-hazard risks...
Chapter 7: End of Chapter Exercises Homework . Due in 5 days 0 3/13 answered har...
Chapter 7: End of Chapter Exercises Homework . Due in 5 days 0 3/13 answered har Unanswered 1 attempt left Submit Chapter 7 Review Questions 5 Homework - Unanswered What are the potential cash inflows to be considered in a net present value analysis of a loss control decision? ОА Reduced costs, premium savings, tax savings resulting from depreciation for loss control equipment, and salvage value of the equipment. 0 B The costs of training and maintenance of the equipment...
Chapter 7: End of Chapter Exercises Homework . Due in 5 days 2/13 answered Chapter 7...
Chapter 7: End of Chapter Exercises Homework . Due in 5 days 2/13 answered Chapter 7 Review Questions 13 Homework - Unanswered Airlines face significant risk from increases in the price of jet fuel. The failure of their computerized reservation systems also can have a materially adverse effect on their operations. How could an airline use the concepts of enterprise risk management and alternative risk transfer tools to manage these risks? O A Purchase a double trigger insurance policy O...
Chapter 7: End of Chapter Exercises Homework • Due in 5 days wered OL Homework –...
Chapter 7: End of Chapter Exercises Homework • Due in 5 days wered OL Homework – Unanswered If a firm wants to have $1 million in cash available in three years, how much must it invest now at an 8 percent interest rate? O A $793,832.24 O B $780,832.24 O O c $810,832.24 SD $1,000,000 I attempt left Unanswered
Chapter 7: End of Chapter Exercises Homework . Due in 5 days 0 3 /13 answered...
Chapter 7: End of Chapter Exercises Homework . Due in 5 days 0 3 /13 answered Answered - Correct! No attempts left Chapter 7 Review Questions 3 Homework • Unanswered Explain how an investment in loss control may change the optimal mix between risk retention and risk transfer in a given situation. Effective loss control can reduce the frequency and severity of expected losses. This reduction may provide the opportunity for a company to retain more than it would without...
Chapter 7: End of Chapter Exercises Homework . Due in 5 days Homework Unanswered 3/13 answered...
Chapter 7: End of Chapter Exercises Homework . Due in 5 days Homework Unanswered 3/13 answered WPR Corporation owns 5,000 hotels and motels throughout the world. If you were the WPR risk manager, what risks might you suggest should be treated through the risk avoidance technique? Select the most appropriate answer A Avoid risks associated with business activities not consistent with its goals B Avoid risks associated with running homeless shelters that WPR does not have in its business plan...
Chapter 7: End of Chapter Exercises Homework . Due in 5 days 3/13 answered Chapter 7...
Chapter 7: End of Chapter Exercises Homework . Due in 5 days 3/13 answered Chapter 7 Review Questions 8 Homework – Unanswered True or False: The cost that companies incur when they set aside capital for losses instead of using it for working capital in the business is the opportunity cost of funds. The capital has a value. If the capital is used in the business, then the value is often more than if it is used for paying losses....
Chapter 7: Selecting and implementing Risk Management Homework . Due in 5 days gement T... 7/11 answered ELE --------- - - to perform present value computations. Key Concepts 7.3 Homework • Unanswered In the calculation of the present value of $500,000 available in five years presented above, how would the present value change it the interest rate was increased from 8 percent to 10 percent? A the present value would be lower the present value would be higher resent value...
Chapter 7: Selecting and implementing Risk Management Homework . Due in 5 days Key Concepts 7.8 Homework – Unanswered Which of the following is NOT a situation where self-insurance would normally make sense for a business? A The business has faced some financial challenges and has low cash levels The business has a relatively large number of similar exposures and the potential for simultaneous destruction is low 0 C The business has access to relatively good data on the past...
Chapter 7: Selecting and implementing Risk Management T... Homework . Due in 5 days 4/11 answered Key Concepts 7.9 Homework . Unanswered Which one of the following situations would represent a case of "natural hedging"? O A A firm buys insurance to cover loss due to windstorm damage O B A business rents vacation homes on the beach and runs a store that sells ice cream to beach visitors O C A farmer grows two crops, one does well in...
Chapter 7: Selecting and implementing Risk Management... Homework . Due in 5 days 4/11 answered 8. Lapses in due diligence relating to mergers and acquisitions 9. Counterparty reliability in financial hedges 10. Spoilage or crop disease causing damage to the quantity, quality or marketability of grain supplies Source: Willis Group Assigned as Homework O Discussion Question The adoption of ERM has become much more common in firms of all types including hospitals. What do you think are three non-hazard risks...
Chapter 7: End of Chapter Exercises Homework . Due in 5 days 0 3/13 answered har Unanswered 1 attempt left Submit Chapter 7 Review Questions 5 Homework - Unanswered What are the potential cash inflows to be considered in a net present value analysis of a loss control decision? ОА Reduced costs, premium savings, tax savings resulting from depreciation for loss control equipment, and salvage value of the equipment. 0 B The costs of training and maintenance of the equipment...
Chapter 7: End of Chapter Exercises Homework . Due in 5 days 2/13 answered Chapter 7 Review Questions 13 Homework - Unanswered Airlines face significant risk from increases in the price of jet fuel. The failure of their computerized reservation systems also can have a materially adverse effect on their operations. How could an airline use the concepts of enterprise risk management and alternative risk transfer tools to manage these risks? O A Purchase a double trigger insurance policy O...
Chapter 7: End of Chapter Exercises Homework • Due in 5 days wered OL Homework – Unanswered If a firm wants to have $1 million in cash available in three years, how much must it invest now at an 8 percent interest rate? O A $793,832.24 O B $780,832.24 O O c $810,832.24 SD $1,000,000 I attempt left Unanswered
Chapter 7: End of Chapter Exercises Homework . Due in 5 days 0 3 /13 answered Answered - Correct! No attempts left Chapter 7 Review Questions 3 Homework • Unanswered Explain how an investment in loss control may change the optimal mix between risk retention and risk transfer in a given situation. Effective loss control can reduce the frequency and severity of expected losses. This reduction may provide the opportunity for a company to retain more than it would without...
Chapter 7: End of Chapter Exercises Homework . Due in 5 days Homework Unanswered 3/13 answered WPR Corporation owns 5,000 hotels and motels throughout the world. If you were the WPR risk manager, what risks might you suggest should be treated through the risk avoidance technique? Select the most appropriate answer A Avoid risks associated with business activities not consistent with its goals B Avoid risks associated with running homeless shelters that WPR does not have in its business plan...
Chapter 7: End of Chapter Exercises Homework . Due in 5 days 3/13 answered Chapter 7 Review Questions 8 Homework – Unanswered True or False: The cost that companies incur when they set aside capital for losses instead of using it for working capital in the business is the opportunity cost of funds. The capital has a value. If the capital is used in the business, then the value is often more than if it is used for paying losses....
Most questions answered within 3 hours.
-
An software company has three different promotion plans for
its software purchase:
plan A: each software...
asked 7 minutes ago -
If
P(A)=.62, P(B)=.47, & P(A or B)=.88. What is the likeliness of
selecting only A?
A)...
asked 6 minutes ago -
What is the FUTURE VALUE of $500 invested for 3 years at 7% with
ANNUAL Compounding...
asked 15 minutes ago -
Modify the method so that instead of manually making teams, it
reads it from a text...
asked 14 minutes ago -
1. Which of the following is not a principle to apply to
construction:
Select one:
a....
asked 16 minutes ago -
In what way is a Christian’s position made more challenging by
revealing faith in the workplace?...
asked 23 minutes ago -
1) There are four categories of customer benefits in B2B
(business-to-business) markets. Which of the following...
asked 20 minutes ago -
What is the pH of a 150.0 mL solution of 0.0273 M NaOH (strong
base)?
asked 30 minutes ago -
A thin ball shell is shaped like a hollow ball with a radius of
26.6 cm....
asked 35 minutes ago -
What mass of KX (Mm= 180 g/mol) is required to prepare 483 mL of
a pH...
asked 35 minutes ago -
In a lottery game, 4 numbers from 1 to 29 are selected. Winners
must match all...
asked 46 minutes ago -
A catfish is 2.5 m below the surface of a smooth lake.
(a) What is the...
asked 48 minutes ago