Spreadsheet Modeling & Decision Analysis: A Practical Introduction To Business Analytics, Loose-leaf Version
8th Edition
ISBN: 9781337274852
Author: Ragsdale, Cliff
Publisher: South-Western College Pub
expand_more
expand_more
format_list_bulleted
Concept explainers
Question
Chapter 3, Problem 19QP
a)
Summary Introduction
To formulate: An linear programming model for the problem.
b)
Summary Introduction
To develop: A spreadsheet model and solve using solver.
c)
Summary Introduction
To identify: The optimal solution.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Your sister and her fiancé are planning on getting engaged (and later married) in the future. Wanting
to start saving up for the wedding costs, they ask you
having $60,000 saved four years from now. They also would like to withdraw $15,000 in a year to pay
for the engagement rings.
help them invest their money in the hopes of
Besides their initial deposit, they also plan to make another deposit in three years as they are
expected to receive an $8,000 settlement from a class-action lawsuit by then.
There are one-year and two-year investments available for each year as well as a special three-year
investment that becomes available in a year, shown in the diagram below. One-year investments
return 2.5%, two-year investments return 6%, and the three-year investment return 10%.
Formulate as a linear program using the variables that are listed on the diagram and solve to
minimize the initial deposit your sister and her fiancé must make.
Deposit (Xo)
Present
Хо1
Withdrawal
Xo2
($15,000)
Year…
Aventura Savings and Loan requires 15% down payment on a mortgage loan. What is the down payment needed to finance a $148,500 home?
Bruin Properties is in escrow to buy a 175,000 square foot shopping center in Camarillo, California for $35,000,000. Bruin Properties can borrow $24,000,000 fixed rate fully amortizing over 30 years at a 6.0% annual interest rate with equal monthly payments of principal and interest or it can borrow $28,000,000 fixed rate fully amortizing over 30 years at a 7.0% annual interest rate with equal monthly payments of principal and interest. What is the incremental annual borrowing cost for the additional $4,000,000 loan amount if each loan would be outstanding for the full 30 year term?
a.13.0%
b.12.4%
c.11.5%
d. 7.0%
Chapter 3 Solutions
Spreadsheet Modeling & Decision Analysis: A Practical Introduction To Business Analytics, Loose-leaf Version
Ch. 3 - Prob. 1QPCh. 3 - Prob. 2QPCh. 3 - Prob. 3QPCh. 3 - Prob. 4QPCh. 3 - Prob. 5QPCh. 3 - Prob. 6QPCh. 3 - Refer to question 19 at the end of Chapter 2....Ch. 3 - Prob. 8QPCh. 3 - Prob. 9QPCh. 3 - Prob. 10QP
Ch. 3 - Prob. 11QPCh. 3 - Prob. 12QPCh. 3 - Prob. 13QPCh. 3 - Prob. 14QPCh. 3 - Prob. 15QPCh. 3 - Prob. 16QPCh. 3 - Prob. 17QPCh. 3 - Tuckered Outfitters plans to market a custom brand...Ch. 3 - Prob. 19QPCh. 3 - Prob. 20QPCh. 3 - Prob. 21QPCh. 3 - Prob. 22QPCh. 3 - Prob. 23QPCh. 3 - Prob. 24QPCh. 3 - Prob. 25QPCh. 3 - Prob. 26QPCh. 3 - A manufacturer of prefabricated homes has decided...Ch. 3 - Prob. 28QPCh. 3 - Prob. 29QPCh. 3 - Prob. 30QPCh. 3 - Prob. 31QPCh. 3 - Prob. 32QPCh. 3 - Prob. 33QPCh. 3 - Prob. 34QPCh. 3 - Prob. 35QPCh. 3 - Prob. 36QPCh. 3 - Prob. 37QPCh. 3 - Prob. 38QPCh. 3 - Prob. 39QPCh. 3 - Prob. 40QPCh. 3 - Prob. 41QPCh. 3 - Prob. 42QPCh. 3 - Prob. 43QPCh. 3 - Prob. 44QPCh. 3 - A natural gas trading company wants to develop an...Ch. 3 - Prob. 46QPCh. 3 - The CFO for Eagle Beach Wear and Gift Shop is in...Ch. 3 - Prob. 48QPCh. 3 - Prob. 1.1CCh. 3 - Prob. 1.2CCh. 3 - Prob. 1.3CCh. 3 - Prob. 1.4CCh. 3 - Prob. 2.1CCh. 3 - Prob. 2.2CCh. 3 - Prob. 2.3CCh. 3 - Prob. 2.4CCh. 3 - Prob. 2.5CCh. 3 - Kelly Jones is a financial analyst for Wolverine...
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, management and related others by exploring similar questions and additional content below.Similar questions
- Where a financial institution makes a loan commitment, the borrower, in drawing down on their loan commitment, causes increased cash flow needs by the DI to fund the loan commitments. There are three ways a DI can offset the effect of Asset-side liquidity risk such as drawing down of a loan commitment in all of the following sitiuations Except: a. Reduce excess cash reserves to minimum levels required to meet reserve requirements based on the decision made by management independant of regulatory requirements. b. Reduce balance sheet items such as retain earnings to the meet the minimum required capital levels. c. Taking offsetting measures such as borrowing funds or even purchasing funds on the money market. d. Reducing liquid type assets on their balance sheet such at T-bills by selling them.arrow_forwardLorna owns a home that is worth $385,000. She has a mortgage with a balance of $112,000. Calculate her equity in the home. $497,000 $76,000 $273,000 $245,000arrow_forwardFormulate but do not solve the problem.The management of a private investment club has a fund of $200,000 earmarked for investment in stocks. To arrive at an acceptable overall level of risk, the stocks that management is considering have been classified into three categories: high-risk, medium-risk, and low-risk. Management estimates that high-risk stocks will have a rate of return of 16%/year; medium-risk stocks, 8%/year; and low-risk stocks, 6%/year. The investment in low-risk stocks is to be twice the sum of the investments in stocks of the other two categories. If the investment goal is to have an average rate of return of 9%/year on the total investment, determine how much the club should invest in each type of stock. (Assume that all the money available for investment is invested. Let x, y, and z denote the amount, in dollars, invested in high-, medium-, and low-risk stocks, respectively.) _____= 200,000 _____= z _____ = .09(200,000)arrow_forward
- Do a and b only.arrow_forwardA UCLA student saved $100,000 for the down payment on a $1,000,000 one-bedroom, two-bathroom home in Encino, California. She can qualify for either a $900,000 fully amortizing 30-year first mortgage loan at a 4.75% annual interest rate from Wells Fargo Bank, or she can qualify for a $790,000 fully amortizing 30-year first mortgage loan at a 4.25% annual interest rate with a $110,000 fully amortizing 30-year second mortgage loan at an 8.00% annual interest rate from Citibank. Should the student prefer the single $900,000 mortgage loan from Wells Fargo Bank or should she prefer the $790,000 first mortgage loan and $110,000 second mortgage loan package from Citibank? Single loan from Wells Fargo Bank No difference Depends on all the terms and conditions in the loan documents from Wells Fargo Bank as compared to those from Citibank Loan package from Citibankarrow_forwardWhat is the future worth (in Year 10) of $23,000 deposited at the end of Year 3 plus $28,000 deposited at the end of Year 5, and $20,000 deposited at the end of Year 8 at an interest rate of 5% per year?arrow_forward
- Mr. King invested $30,000 in the First Eagle fund in year 2004. He continued to invest in the same fund from 2005 to 201 las in the following schedule: Year 2005 $30,000 Y ear 2006 $50,000 Year 2007 $50,000 Year 2008 $150,000 Year 2011 $100,000 All the dividends distributed by the company from time to time were reinvested in the same fund. In year 2012 Mr. King received a report showing a total balance of $548,360 in his account. What is the internal Rate of return of Mr. King's investments in the mutual fund? Answer: 7% (Note: cash flows in 2009 and 2010 are 0.) Show work in Excelarrow_forwardA rich person passes away, leaving the following legacy: 1- A Caillebotte picture: 25000$2- A bust of Diocletian: 5000$3- A Yuan dinasty chinese vase: 20000$4- A 911 Porsche: 40000$5- Three diamonds: 12000$ each6- A Louis XV sofa: 3000$7- Two very precious Jack Russell race dogs: 3000$ each (the will asserts that they may not be separated)8- A sculpture dated 200 A.D.: 10000$9- A sailing boat: 15000$10- A Harley Davidson motorbike: 10000$11- A piece of furniture that once belonged to Cavour: 13.000$. These items must be shared between the two sons. Write an optimization model to find a partition of these items that minimizes the difference between the values of the two parts? Carefully explain all of the decision variables, constraints, objective function, and an appropriate solving method that you would choose. You *do not* need to solve your optimization model.arrow_forwardM-REITs, or mortgage REITs, primarily invest in real estate loans and mortgage-backed securities that are often below investment grade. When a mortgage REIT decided some years ago to re-securitize a substantial portion of its CMBS "BB" and "B" securities, it received surprisingly high investment grade ratings of "A" and "BBB" from Standard & Poor's on the new securities that were created from the cash flows of the underlying portfolio of non-investment grade rated securities. But when the financial markets began to fall a few months later, that mortgage REIT quickly went bankrupt and the value of its "A" and "BBB" investment grade rated re-securities fell substantially. The intended purpose of the ratings agencies is: To produce substantial profits for the rating agencies from the fees paid to them for giving higher ratings on investments than might otherwise be appropriate To help businesses and governments raise needed capital by providing them with the ratings they need to…arrow_forward
- Mr. Johnnie B. Good has a furniture business which he operates as a sole proprietor. The business has been doing well for several years and now he wants to finance the expansion of his business by way of a loan and he is thinking of approaching BCN Bank accordingly. He is also planning to buy a great deal of raw material on credit from Miller’s Hardware in support of the business expansion. Mr. Good in looking at the potential risks to his personal assets and in an effort to safeguard himself from losing his personal assets if the business failed and was not able to repay the loan or pay for the material he got on credit, filed the relevant documents with the companies office and incorporated a private company, Good Furniture Ltd, with him as the sole shareholder and director and then went ahead and obtained a loan in the company’s name from the bank and bought the raw material on credit on behalf of the company. The bank in providing the loan ensured that Mr. Good signed a personal…arrow_forwardOn January 1, 2020, Naruto Company, a financial services firm, purchased P100,000, face value 5-vear bond of Wolverine Corporation for P108,660, a price that yields 5% on a stated interest rate of 7%. Interest is payable annually at December 31. Fair values at year-end are as follows: 105.7 December 31, 2020 December 31, 2021 December 31, 2022 December 31, 2023 106.0 106.5 107.5 Naruto's business model for managing debt securities of this type is collecting cash flows that are salely payment for principal and interest. Naruto did not exercise its option to measure the investments at fair value. Towards the end of 2022, after reviewing its strategic direction, Naruto decides to shut down its retail mortgage business and actively markets its debt investments portfolio in response to profit taking opportunities. Naruto sold the Wolverine Corporation bonds on May 31, 2023 @ 106 plus accrued interest. REQUIRED: How much interest income should Naruto recognize for the year 2020 as a result…arrow_forwardProperty Owner Bill is selling the apartment complex he owns to Property Owner Liz. What happens to the security deposits and advance rents that Bill has been holding? Bill needs to transfer all security deposits and advance rents back to the tenants, who will then write new checks to Liz. Bill needs to do nothing, as under the Florida Residential Landlord and Tenant Act, he can keep these monies as part of the sale. Bill needs to reimburse the tenants within 30 days of giving ownership to Liz. Bill needs to transfer all security deposits and advance rents to Liz, and also give her an accounting of how much should be credited to each tenant's account.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Practical Management ScienceOperations ManagementISBN:9781337406659Author:WINSTON, Wayne L.Publisher:Cengage,
Practical Management Science
Operations Management
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:Cengage,