Concept explainers
Videos
Kelly Jones is a financial analyst for Wolverine Manufacturing, a company that produces engine bearings for the automotive industry. Wolverine is in the process of hammering out a new labor agreement with its unionized workforce. One of the major concerns of the labor union is the funding of Wolverine’s retirement plan for its hourly employees. The union believes the company has not been contributing enough money to this fund to cover the benefits it will need to pay to retiring employees. Because of this, the union wants the company to contribute approximately $1.5 million dollars in additional money to this fund over the next 20 years. These extra contributions would begin with an extra payment of $20,000 at the end of 1 year with annual payments increasing by 12.35% per year for the next 19 years.
The union has asked the company to set up a sinking fund to cover the extra annual payments to the retirement fund. The Wolverines’ CFO and the union’s chief negotiator have agreed that AAA rated bonds recently issued by three different companies may be used to establish this fund. The following table summarizes the provisions of these bonds.
According to this table, Wolverine may buy bonds issued by AC&C for $847.88 per bond. Each AC&C bond will pay the bondholder $80 per year for the next 15 years, plus an extra payment of $1,000 (the par value) in the fifteenth year. Similar interpretations apply to the information for the IBN and MicroHard bonds. A
Wolverine’s CFO has asked Kelly to determine how much money the company would have to invest and which bonds the company should buy in order to meet the labor union’s demands.
If you were Kelly, what would you tell the CFO?
Want to see the full answer?
Check out a sample textbook solution
Chapter 3 Solutions
Spreadsheet Modeling & Decision Analysis: A Practical Introduction To Business Analytics, Loose-leaf Version
- The losses for the pump in the previous question are estimated to be 15% of the relative dynamic head at inlet to the impeller and 45% of the dynamic head at inlet to the diffuser. Calculate the head delivered and the efficiency of the pump. Answers: 4.12m;75.4%arrow_forwardDescribe the difference between coaching and mentoring. Which would you work best in an organization experiencing systemic organizational change? Explain choice.arrow_forwardMany students are surprised to learn that employees may be fired for any reason not expressly prohibited by the law. As we have seen, the law requires employers to accommodate a fairly wide range of employee behaviors and conditions. However, there are still classes of employees and behaviors that are not protected by federal law, e.g., sexual orientation or political affiliation. Should the law be expanded to cover additional classes and behaviors? Why or why not?arrow_forward
- Saturated moist air at 15 °C and standard atmos- pheric pressure undergoes a process which has a sensible-heat ratio of SHR 0.70. After the process, the dry-bulb temperature is 40 °C. By the psychrometric chart, determine the following at the end of the process: (a) humidity ratio, (b) dew-point temperature, (c) relative humidity, and (d) wet-bulb temperature.arrow_forwardDraw a plant with esthetic: solar csp tower that powers brayton cycle, has a fish farm as cogeneration. and heat storage; label every component and show flow directionsarrow_forwardWe are all from different social, cultural, economic, and demographic backgrounds. This human resource course brought us together as one group. discuss your experience learning about your classmates and how it impacted your understanding of people from other backgrounds. Reflect on what you learned in this course, and describe how you envision using your knowledge for personal or professional succarrow_forward
- https://web.p.ebscohost.com/bsi/pdfviewer/pdfviewer?vid=1&sid=893c3f08-cf0a-4524-bfec-e7d61e03aa2a%40redis Base on the link above i need help answering the following for week 2 How would I consider myself an engaged employee? would the questions make you think of anything that can be done your healthcare organization to increase employee engagement and performance? Would I add any questions to the list? How can managers in the health care industry utilize these questions?arrow_forwardIf a test were scored using a criterion-referenced approach, which of the following would most correctly explain a student's low score to the student's caregivers? In relation to the standards and learning objectives covered on this test, your child is not yet proficient. Compared to other children in this class and across the state, your child performed less than average. Your child did better on this test than the previous one.arrow_forwardDesign a normalized order management database with the requirements provided below. Each record should have at least one primary key field specified. After identifying the records and their corresponding fields, draw an entity-relationship (ER) diagram to illustrate the relationships between entities and attributes.arrow_forward
- TRUE or FALSE: It is not worth the loss of instructional time to have students process and act upon their feedback; students generally don't care about the feedback, anyway.arrow_forwardWhich of the following grading practices are considered to be inaccurate, ineffective, and/or harmful for student learning? (Select ALL that apply.) Using the 100-point grading scale Grading everything a student completes (including homework and practice) to encourage compliance Giving or reducing points for behavioral work habits (e.g., being on time for class, participation, submitting assignments on time) Boosting a student's grade because they tried really hard, even though they haven't yet met the learning goals Not allowing a reassessment because the student should have learned it the first timearrow_forwardWhat is the single most important thing you are expected to do when administering a standardized test? Teach students test-taking skills and strategies. Follow the proctor directions exactly. Remind students to get a good rest and eat breakfast the day of the test.arrow_forward
Practical Management ScienceOperations ManagementISBN:9781337406659Author:WINSTON, Wayne L.Publisher:Cengage,