An innovative restaurateur owns and operates a dozen "Ultimate Low-Carb" restaurants in northern Arkansas. His signature item is a cheese-encrusted beef medallion wrapped in lettuce
Sales (x, in millions of dollars) is related to Profits (y-hat, in hundreds of thousands of dollars) by the regression equation y-hat = 8.21 + 0.76 x. What is your forecast of profit for a store with sales of $40 million? $50 million?
Students must recognize that "sales" is the independent variable and "profits" is dependent; the problem is not a time series. A store with $40 million in sales: 40 × 0.76 = 30.4; 30.4 + 8.21 = 38.61, or $3,861,000 in profit. Similarly, $50 million in sales is estimated to produce a profit of 46.21 or $4,621,000.
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Firms do not use LIFO because it
a. produces a cost of goods sold figure based on more recent purchase prices. b. results in lower net income. c. results in reduced tax payments. d. matches the actual flow of goods. e. all of the above
Veritas, Inc is planning its annual shareholder meeting on June 15 . The company
a. need not send notices of the meeting to shareholders since it is the regularly scheduled, annual meeting, which Veritas always holds on the third Thursday of June. b. must send notices to everyone who owns stock as of January 1. c. must send notices to everyone who owns stock on the "record date," which can be no more than 70 days before the meeting. d. is not required to have an annual shareholders meeting if the company is listed only on the NYSE.
Which of the following forecasting methods puts the least weight on the most recent time series value?
a. exponential smoothing with ? = 0.3 b. exponential smoothing with ? = 0.2 c. moving average using the most recent four periods d. moving average using the most recent three periods
Why should corporations be allowed to generate profits?
A) So they can hire talented employees. B) To help establish a legal framework for the country in which they operate. C) So the government can generate more tax dollars. D) Because the country's standard of living involves the goods and services created by profit-seeking companies. E) Because stakeholders of the company demand a return on their investment in the organization.