Explain if you think that global terrorism can be stopped.
Explain if you think that global terrorism can be stopped.Analyze the responsibility of the United States today to be the world’s “policeman.”Assess if peace and stability in the Middle East are vital to U.S. economy and national security.If the United States withdrew its troops from the Middle East tomorrow, would the terrorist threat end. Why or why not?Assess if the use of military force is the only way to prevent terrorism. Are there other possible alternatives? Which strategy is best and why?
Discuss the challenges of maintaining information security at a remote recovery location.
We develop good DR plans and some of those plans will include a remote recovery site (hot or cold). How do we ensure that the remote site is protected like we would the main location? Discuss the challenges of maintaining information security at a remote recovery location.***Standard for all discussion posts:Please make your initial post and two response posts substantive. A substantive post will do at least two of the following: At least one scholarly source should be used in the initial discussion thread. Be sure to use information from your readings and other sources from the UC Library. Use proper citations and references in your post.
Describe what the ideal safety management system looks like to you. Do you think it makes a difference in how hazards and risks are managed and controlled?
Describe what the ideal safety management system looks like to you. Do you think it makes a difference in how hazards and risks are managed and controlled? Why, or why not?ALSO PLEASE REPLY TO ANOTHER STUDENTS COMMENT BELOW Michael;The ideal safety managment system should be comprehensive. There should be a system that takes data to identify the possible risks. For there the best practices should be enforced to ensure that the problem is solved. This should be done using the hierachy method. The process for managing and controlling hazards and risks will pretty much be the same. There needs to be an identificaiton system followed by the implementation of PPE and control measures. The goal for both is to be proactive rather than reactive.
Can you think of any other technology that has been put into a vehicle or is proposed that could infringe on personal information?
Drunk Driving Could Start to End Forever, as Soon as 2024, Government SaysNew bipartisan Senate bill calls for onboard test equipment in every new car to prevent it from starting if driver’s BAC is 0.08 or higher.In an age in which cars are getting loaded up with active and passive safety equipment to the point of being able to (nearly) drive themselves, a few U.S. senators are looking to put one more piece of safety technology on board. This time, it’s alcohol-detection equipment. With 30 people dying in alcohol-related vehicle accidents on American roads every day, or about one every 48 minutes, it’s no wonder the federal government is looking for a way to make those numbers decline.https://www.caranddriver.com/news/a29555598/government-anti-drunk-driving-plan-revealed/This will increase the price of a car for everyone. Share your thoughts on this legislation. Consider your submission for assignment 2 this week – will this be additional information that a court could access in the case of an accident? Can you think of any other technology that has been put into a vehicle or is proposed that could infringe on personal information?
What policy changes would you implement to address violent crimes toward the most vulnerable victim population in your city or state?
Victimologists seek to answer key questions about crime and how some people are more likely to be victims of crimes than other people. By studying crime statistics, criminologists and victimologists can discover important findings, such as the following:
Rates at which certain crimes occur
Trends that relate to the frequency and location of crimes
Identifying groups that tend to be arrested for (or be victims of) certain types of crime
Impact of laws, correctional programs, or law enforcement efforts on crime
Government data collection systems have their own strengths and weaknesses in terms of providing different types of data (e.g., data provided from police agencies and data collected from surveys).
Explore the following websites:
FBI’s Crime Data Explorer: An interactive site that allows you to look up your local community’s crime and victim data
National Crime Victimization Survey (NCVS): An annual report that provides information on unique crime estimates, victimization estimates, and the number of specific criminal acts.
2019 Criminal Victimization Summary
2019 Criminal Victimization Full Report
Write a paper that addresses the following:
What differences exist between these reporting tools? What did you find most helpful in your understanding of crime and victim data among each of these sources?
Knowing your communities, knowing your services, how would you use this data to provide services in your communities?
What policy changes would you implement to address violent crimes toward the most vulnerable victim population in your city or state?
Explain network, security and operating systems techniques, standards, and practices
Length: 2000 words
Intended Learning Outcomes (ILOs) assessed:
- Explain network, security and operating systems techniques, standards, and practices 4. Analyse strengths and weaknesses of security protocols for contemporary and emerging
technologies and systems
This assignment requires you to investigate and write an essay (in English) on a specified topic relating to networks and security. There are three topics to choose from in different areas that relate to the content of this unit and its extended field of interest.
• This assignment needs to be completed as an individual. You must not engage nor employ others to write the essay for you – this is considered academic misconduct.
• You must select and write about one of the 3 available topics listed below, and you may not resubmit work previously submitted for this or other units you have studied in the past.
• This assignment is to be approximately 2000 words in length (plus or minus 10%, not including the references section). You are highly encouraged to include relevant diagrams and figures to make your essay more readable and interesting.
• Your essay must not include a table of contents nor an executive summary. However, you should consider including logical sections and subsections (with titles) to improve the essay’s readability.
Please pay close attention to the section near the end of this document on plagiarism. We treat plagiarism very seriously, and, if detected, it can lead to some serious penalties.
1 - Topic list
Choose from one of the following 3 topics. Your essay title must specify which topic you have chosen (topic 1, 2 or 3): - Zero-day attacks associated with hardware or software systems are becoming more common. Discuss these types of attack, including recent examples, why such attacks are increasing in frequency, and what preventative or mitigation actions are possible. Include in your discussion the key drivers behind exploit development for these attacks, who is doing it, and why.
- The recently discovered Log4J vulnerability has highlighted security-related issues with open source software dependency supply chains (repositories). Discuss the Log4Shell issue in depth, including who is affected, and what steps can be taken for mitigation. Your discussion should also consider the deliberate exploitation of the supply chain in general and why supply chain vulnerability is a security issue.
- Biometric authentication systems are an increasingly attractive alternative to password schemes that are still the most used authentication method. Discuss the benefits of biometric authentication, what biometric features are commonly sampled, and identify why the wider adoption of such systems has not yet occurred. As part of your answer you should consider the potential vulnerabilities that these systems may have, as well as any ethical and/or legal implications.
- Citations and Referencing
This is a research assignment, and as such you are expected to read a range and diversity of content on your topic, and based on your reading, your thoughts, and understanding in the area, condense/summarise the topic in your essay. This means putting content into your own words and citing where it has come from.
You are expected to use a range of different sources, including academic sources.
3.1 What is an academic source?
Most academic sources will likely be formally peer-reviewed articles that have been published in journals or conferences, although other sources are permitted (such as books, and government and/or standards bodies documents). Magazines, web sites, blog posts and news articles are not considered to be academic sources – you may still include them as sources, but your marks will be improved when academic sources are also included (please see the marking rubric).
3.2 What do I have to cite?
All source material (anything you have read an obtained from elsewhere) must be cited and then be listed in a references section at the end of the assignment. Correctly citing and referencing the content you have used makes up a significant part of your final mark. You must use citations and referencing when making statements that are not otherwise common knowledge – you provide citations to justify all claims or statements you have made in your essay:
‘A citation is a reference to the source of information used in your research. Any time you directly quote, paraphrase or summarize the essential elements of someone else’s idea in your work, an in-text citation should follow. An in-text citation is a brief notation within the text of your paper or presentation which refers the reader to a fuller notation, or end-of-paper citation, that provides all necessary details about that source of information.’ (Suny Empire 2021)
In other words, any borrowed ideas (which includes direct quotes such as that above), must be acknowledged through the form of an in-text citation in the body of your essay (Victoria University 2015).
? It should be noted that any sources you include in your references section must be referred to by in-text citations – you cannot include a source (and have it counted) if you do not actually refer to it.
3.3 What referencing style do I have to use?
You are required to use the Harvard referencing style, which in simplest terms, is the Author/Year style. More information can be found by following the links below.
• https://utas.libguides.com/referencing/Harvard
• https://mylo.utas.edu.au/d2l/le/content/506348/viewContent/4322786/View
• https://libraryguides.vu.edu.au/harvard/getting-started-with-harvard-referencing
There is also a brief, non-assessed quiz in unit’s MyLO site to help you consolidate your knowledge on the Harvard referencing style:
• Assessments?Quizzes?Referencing Quiz - Plagiarism and Academic Integrity
Plagiarism is a very serious matter, and ignorance of this is not an excuse. If you submit work, claiming it to be your own, and it is not original work of your own, this is cheating. This includes (but is not limited to) trying to obscure the source of your work (such as blocks of text submitted as images), using language translation services to source text from one language and convert to another, or paying individuals or companies to do the work for you. Plagiarism can result in academic penalties both in relation to your assignment, and on your permanent university record.
If the work you submit is that of another person, without appropriate attribution (such as citation and references), then an academic misconduct case may be filed against you with the possible penalties mentioned above.
4.1 Where can I find more information on academic integrity?
More information can be found here:
• https://universitytasmania.sharepoint.com/sites/StudentPortal/SitePages/Academic -Integrity.aspx
• https://faq.utas.edu.au/app/answers/detail/a_id/1947/~/what-is-plagiarism-andacademic-integrity%3F
Note: We will be using Turnitin as a plagiarism detection tool. - Submission
The essay is due on Thursday the 7th of April (Week 7) at 11:59 pm. You must submit your assignment in MyLO via the assignment submission link in the Assessment section of the MyLO unit website.
• The submission must be a single Word document
• Do not submit in PDF format, and do not ZIP or compress your file before submission
• You are not required include an electronic cover sheet, as submitting to MyLO is an implicit acknowledgement of accepting the University’s policies around plagiarism and your way of claiming that this is entirely your own work. - Hints
-where should I start?-
• the library online catalogue search is a good starting place to search for academic references
e.g. https://www.utas.edu.au/library/find/megasearch (but note however not all search results are academic in nature, some search results are news sites and magazines etc)
• Google scholar (or international alternatives) are also good for finding academic sources – https://scholar.google.com.au
• Web sites (for news articles, blogs, security company technical papers etc)
• Textbooks on networking and security - How is your essay marked?
Your essay will be marked against the rubric that can be found on the next page. Please pay close attention to the weighting % of each criterion and how each grade (HD, DN etc) is assigned. Also note, for example, the Referencing criteria does not mean you will automatically get full marks (25%) if you have 10 or more sources, including 6 academic sources – the mark is assessed on how well you use the sources (e.g. are they relevant), the referencing style, as well as the source quality (for example, are too many of the references from the one web site, or the one company, or the one news report, and are they just blog sites etc).
Describe concisely your overall marketing strategy and objectives for your product/service.
Please complete each of the following sections in the business plan template and submit to Moodle.
Marketing & Communications Strategy (1,750-2,000 words approx)
Staffing and Operations (1,750-2,000 words approx)
You should submit this draft as one document– i.e. you do not submit sections separately. You could allocate a moderate amount of the word count from one of the above sections to the other e.g the Marketing section could be allocated 2,200 words and the Staffing & Operations section could be allocated 1,800 words, if deemed applicable to the nature of your business idea.
Use the business plan template for guidance on all of the items covered in each section (the relevant sections have been copy and pasted below) however, please be mindful that you may adapt certain elements that are appropriate to suit your individual business.
Marking Scheme:
Section Description Available Marks Actual Mark
- Marketing & Communications Strategy
(1,750-2,000 words) Marks will be awarded for completion and quality of:
• Marketing strategy
• Pricing
• Revenue Model & Sales Strategy
• Sales Forecast
• Communications Strategy 50% - Staffing and Operations
(1,750-2,000 words) Marks will be awarded for completion and quality of:
• Organisational Chart
• Staffing
• Operations 50% - Marketing and Communications Strategy
This section sets out your strategies for reaching your target market, arousing their interest in your product or service, and actually delivering the product or service to them in sales. The points listed below within each sub-section can vary considerably from business to business, please adapt to suit your particular business.
5.1 Marketing Strategy
Initially
Describe concisely your overall marketing strategy and objectives for your product/service.
Examine the various levels of your product/service: Examine the Core, actual and augmented levels of a product/service.
Put forward a Positioning statement. This will outline how you will position your product or service in the market and differentiate it from its competitors? See class notes on this topic.
5.2 Pricing
Identify the pricing strategy that your business will adopt for your key target market(s). For instance, cost plus or premium pricing. Justify your choice.
It is recommended to include a table to compare your target market prices along with those of your major competitors.
5.3 Sales Forecast
Discuss your sales forecast which will provide the basis for the sales and cash flow figures in your financial projections. These must be based on realistic assessments. Discussion includes aspects such as:
• Number of transactions per day
• Average customer spend or average deal size (if B2B)
• Sales per month (account for seasonal variations)
• Length of sales cycle (B2B and B2C)
• Recurring revenues e.g. subscriptions etc.
• Cash and Credit Sales (if relevant)
5.4 Revenue Model & Sales Strategy
? How will your business generate revenue? Is there perhaps Recurring revenue e.g Subscriptions, memberships, donations e.g Patreon. It could also be Ad-based or else the traditional ‘transactional model’.
? How you will sell your product or service to the target market.
• Direct selling
• On or off-line (or both)
• Retailers/stockists
• Distributor/Agent
• Third Parties/partners
Analyse for each chosen method: the costs involved, justify how it will reach the intended target markets efficiently, the control you would retain over the pricing and positioning, the logistics, and the overall integration with your marketing strategy. State the advantages of the methods you have chosen to sell your product or service.
5.5 Communications Strategy
How you will promote your product or service in the marketplace and communicate with your customers. What key promotional tools will you adopt? e.g.
Traditional Promotional Methods:
For example:
• Advertising – where, when, how, to whom. If you are not going to advertise, please justify your reasons.
• Public relations
• Direct marketing
• Exhibitions etc.
• Word of mouth
Internet/Digital and Social Media Marketing
What key forms of Internet and Social Media Marketing will you utilise? Be as creative as possible keeping in mind that costs should aim to be minimized for start ups.
Identify what you want to achieve from your Social Media Marketing strategy and identify the Key Performance Indicators (KPIs) to ensure that your strategy is on course.
You will need to fully cost each marketing communication method and you should have a summary table at the end of this section. For instance:
Costs Year 1 Costs Year 2 Costs Year 3
Advertising
Public Relations
Direct marketing
Exhibitions
Internet and Social Media Marketing
Total Marketing Costs - Staffing and Operations
This is where you will outline the intended structure of the company in terms of management, number of employees, and the physical operational requirements to produce or supply the product or service. These vary greatly from business to business, please adapt to suit your particular business
6.1 Organisational Chart
Include a short diagram of the way in which the management of the new venture will be organized outlining the various Functional responsibilities, who is charged with responsibility for the key functions of the company e.g. Marketing, I.T, Operations, Finance etc. Please provide a short description to accompany the chart.
You and your business partners (if you have any) may or may not take charge of a number if not all of these during the start-up stage. Certain functions however may be outsourced e.g. Housekeeping/Cleaning, H.R or even I.T.
6.2 Staffing
Please explain the skills that you and your management team bring to the business – as well as any possible weaknesses in terms of expertise
• Does the product/service require skilled people?
• What will be the mix of Full-time and part-time staff? Perhaps you will utilise self-employed workers (freelancers – widely available on the internet e.g. in the areas of I.T or Marketing), or else perhaps utilise agency staff for certain roles e.g. receptionists, administration etc.
• What are the appropriate salaries for management staff (management staff are usually paid an annual salary – or perhaps you or your business partners will be the sole manager(s)). What will be the hourly pay for your staff?
• Students will need to include a staff roster within this section
Please note: it is not permissible to simply put forward a business idea consisting of only the founder and utilising all outsourced staff.
6.3 Operations
State the physical requirements of the business and provide a very brief comment on each expense. These could include how this expense will be set to rise or fall from year 1 to years 2 and 3. The list below is not exhaustive, please adapt to suit your particular business
• Premises (be creative if possible – perhaps a permanent office is not required at the early stage). Include Rent and Rates of any premises leased.
• Opening hours of the business
• Equipment
• Licenses (if required)
• Production facilities (if relevant)
• I.T Infrastructure (perhaps consider outsourcing)
• Telecommunications
• Insurance
• Trade Mark/Patents
• Miscellaneous e.g. Light and Heat, Postage etc.
• Suppliers
Costs involved – please include a summary chart (see below)
Please note: it is not permissible to put forward a business idea with just the founder working virtually from home with little or no physical and operational infrastructure.
Costs Year 1 Costs Year 2 Costs Year 3
Salaries
Wages
Premises
Equipment
Licenses
etc.
produce a report to the Board of Directors that identifies a potential investment project to help the business grow in the post COVID-19 environment.
The COVID-19 pandemic has affected the businesses and economy dramatically. The Board of Directors is currently considering to diversify its business risk and plan to make some investments that would help the business sustain and grow in the long term. Assume you were the Chief Financial Officer of the company/organisation, you were tasked to produce a report to the Board of Directors that identifies a potential investment project to help the business grow in the post COVID-19 environment.
Write a professional report to the Board of Directors. In your report, you shall propose a investment project, considering the risk and return, evaluating the investment opportunity and analysing its potential impact on the company/organisation with consideration of its financial performance before you make recommendation, including the following discussions:
- Motivation of the proposed investment (200-300 words)
- Conduct investment appraisal using both quantative and qualitative information (500-600 words)
- Critically discuss the risk and return and its potential impact on its financial performance (500-600 words)
- Conclusion and make recommendation (250 words)
Data can be assessed via FAME for publicly traded UK company, stock exchange, Yahoo Finance, as well as the annual report and official website. If you choose a private company, please ensure you can assess the data for your analysis.
Analysis, links, examples and applications of the concepts and discussion should be made to current businesses and situations to show understanding of this module and its contents.
Reference should follow Harvard Referencing Guide. Please do not copy and paste other resources in your report. The appendices of the report shall include relevant supporting data.
How has technology/innovation affected the way teams are managed?
Assessment due 21.03 Words 1200 Words (+/- 10%)
The following assessment task has been designed for students to demonstrate their understanding of the key Sports management concepts covered in the subject by applying them to a professional sporting team of their choosing. Students learn the role the coach/manager/CEO plays in the development and fostering of a high-performance culture. Students use industry skills and analysis and apply them to practical and relevant examples.
Instructions: Task:
i. Choose a successful sporting team that you are familiar with (can be either international or domestic or a team that you are currently involved with). IF YOU CAN CHOOSE A DOMESTIC IN AUSTRALIA IT WILL BE BETTER.
ii. What are the key elements that make this successful
What role do you believe has the coach and/or manager/ CEO played in the development and fostering of team culture and elite team performance?
iv. How has technology/innovation affected the way teams are managed?
v. Compare the way this team functions and the responsibilities of key coaching staff within the organization and to a poor performing team.
vi. Identify 2 positive ways your successful sports team functions and 2 negatives for a poor performing team.
vii. What style of leadership is evident in both of the examples listed above
Below are attached the Slides from Class the modules 1,2,3 and 4
ALSO IS ATTACHED A VERY GOOD ASSESSMENT RELATED TO THE SUBJECT (PLEASE DO NOT COPY AND PASTE BUT COULD BE VERY HELPFUL TO THIS ASSESSMENT, THE SUBJECT SUPPOSED TO BE DONE ON TOP OF THE QUESTIONS THE TEACHER REQUESTED ABOVE)
ATTENTION TO THIS INFORMATION BELOW
Your Report should incorporate the following key sections: Introduction – set the context by presenting your overall topic, discussing any selected references you plan to use to demonstrate your overall argument.
Main Body – discuss your argument and examine new insights/practices that have emerged and the underlying assumptions of these new innovations.
Compare and contrast how the management of teams has evolved as a result of changes in technology. Approach the topic from various points of view e.g.
what are the implications?
What are the new questions emerging from such new technologies?
Conclusion: summarise your argument to draw a concluding statement.
References: present a reference list with at least three (3) references from quality sources, ensure the referencing is consistent throughout.
Layout: double-space your text and use 2.5-centimeter margins.
Pages should be numbered, with the numbers appearing in the bottom right-hand corner of the pages.
Explain what is meant by the internal rate of return of an investment and discuss its relationship to the NPV of an investment.
- Time Value of money – investment criteria
a) You are planning to retire in 25 years time. Immediately after your retirement, you wish to go for a round the world trip lasting one year. Your monthly expenses for the trip work out to be £9000 and the first withdrawal will be made at the end of the month after your retirement. You also want to provide yourself with £35,000 a year for next 15 years on your return from the world trip. How much you should save every month to provide for the above if the effective rate of interest is 14% per annum.
(4 marks)
b) Your firm has a retirement plan that matches all employee contributions with employer contributions on a two-to-one basis. That is if an employee contributes £1,000 per year, the company will add £2,000 to make the total contribution £3,000. The firm guarantees a fixed 6 per cent return on the funds. Alternatively, you can provide for retirement yourself, and you think you can earn 9 per cent on your money. The first contribution will be made one year from today. At that time and every year thereafter, you will put £2,500 into the retirement account, the same amount as you would have contributed to the company pension fund. You plan to retire in 30 years. Are you going to be better off participating in the company scheme or making your own arrangements? Explain the basis of your answer (ignore any tax considerations).
(3 marks)
c)
The manager responsible for the pension fund of Ruthin plc has to present a report to the Board of Directors on the financial position of the fund. He decides to use the position of the typical employee to illustrate the fund’s position. There is £30,000 currently held in the fund for each employee. The typical employee has 15 years to go to retirement and the company’s actuary has proposed that the company should anticipate having to fund pension payments over a retirement period of 12 years for the average employee. The average pension payment per annum is expected to be £12,000 and the rate of return expected on the pension funds investment is expected to be 6 per cent. The manager needs to determine the constant annual sum that the company needs to put into the pension fund for each of the next 15 years to be able to meet the fund’s obligations. Determine this annual sum. (Assume all payments into the fund and all pension payments are made at the end of each year.)
(3 marks)
d) Explain what is meant by the internal rate of return of an investment and discuss its relationship to the NPV of an investment.
(4 marks)
e) Explain the problems posed for the use of the IRR when it is necessary (i) to choose between two investments and when (ii) investments are characterised by negative net cash flows at the end of their lives.
(3 marks)
f) Discuss and evaluate the use of the payback period as an investment criterion.
(3 marks)
(TOTAL 20 MARKS)
2.Capital Expenditure Decisions and Investment Criteria
Raindeer plc
Raindeer PLC is a highly profitable electronics company that manufactures a range of innovative products for industrial use. Its success is based to a large extent on the ability of the company’s development group to generate new ideas that result in commercially viable products. The latest of these products is just about to undergo some final tests and a decision has to be taken whether or not to proceed with an investment in the facilities required for manufacturing. You have been asked to undertake an evaluation of this investment.
The company has already spent £750,000 on the development of this product. The final testing of the product will cost about £40,000. The head of the development group is very confident that the tests will be successful based on the work already undertaken. Another company has already offered Raindeer £1.10 million for the product’s patent and an exclusive right to its manufacture and sale, even though the final tests are still to be completed. This sum being offered is well in excess of the cost of the product’s development, but the company’s management have decided to delay their response to the offer until the result of the investment evaluation is available.
The company anticipates that the product will remain competitive for the next five years after which it is likely to be displaced by some new product that are constantly being introduced as the underlying technology evolves. In the first year it is anticipated that 35,000 units will be sold at a price of £152. From year two through to year four sales are expected to be 45,000 units per annum, but are expected to fall back to 35,000 units in year five.
The product will be manufactured in one of the company’s factories that has considerable spare capacity: it is most unlikely that the space required by the manufacture of this product will be required for any other purpose over the next five years. For the company’s internal accounting purposes all products are charged for the factory space that they utilise and this will amount to £50,000 per annum. The additional costs incurred by the company in the form of heating, lighting and power only amount to £30,000 per annum.
The machinery required for the manufacture of the product will cost £1,200,000. It will have to be depreciated for tax purposes on the basis of an annual 25 per cent writing down allowance (ie. 25 per cent of the remaining book value of the asset, the initial purchase price less the sum of the allowances claimed in previous years). At the end of the five year period the machinery will be sold or retained for use in the manufacture of other products. The resale value of machinery of this nature after being used for five years is likely to be about 30 per cent of its purchase price.
Use will also be made of some equipment already owned by the company. This could be sold today for £70,000 and is expected to maintain its resale value even if it is used for the next five years. This equipment is fully depreciated for tax purposes – it has a zero book value – but is still in good working order.
The cost of the labour and components required for the manufacture of the product has been estimated at £120 per unit for the first year, with labour accounting for 60 per cent of the cost and the components for the other 40 per cent. There are also fixed costs of £150,000 per annum stemming from the manufacturing process. The product will also be charged an allowance for general overheads through the management accounting system and this is set at 5 per cent of a product’s annual revenues. The overheads include the head office expenditure and the company’s expenditure on new product development – an important expense for the company. The initial marketing of the product will cost £200,000.
It is anticipated that the company will have to invest in working capital – holding finished products equivalent to 20 per cent of next year’s unit sales, 25 per cent of the components required for the next year, and it is expected that debtors and creditors will just about offset each other. The tax rate is 30 per cent and the required rate of return on investments of this nature is 14 per cent.
a) Determine the investment’s net present value, the internal rate of return, payback period and the discounted payback period. All key assumptions should be specified and explained and an interpretation provided of results for each of the investment criteria specified. You should identify and explain the costs and benefits that you think should be included in a rational decision making process.
On the basis of your analysis above, make a suitable recommendation for the company’s top management explaining the rationale behind it. (HINT : a good answer should clearly explain each figure used in the analysis – used or not).
(12 marks)
b) Assess how sensitive the calculated NPV is to three inputs employed in the analysis. Provide an interpretation of your results and comment on how valuable you think this analysis may be in taking a decision on the investment. Apart from the sensitivity analysis, use another one method (choose from scenario analysis, Monte Carlo simulation, BEP analysis) to assess your capital budgeting analysis and findings. Compare the methods used in reference to their risk probability.
(4 marks)
c) Assume that the annual rate of inflation is expected to be 4 per cent per annum for the next five years. Also assume that the required rate of return of 14 per cent you employed above is a market determined rate and incorporates an allowance for the expected rate of inflation of 4 per cent. Explain how you would take the expected rate of inflation into account in a revised analysis. (Part (a) of the question should be completed on the basis that the expected rate of inflation is zero.) Rework the NPV analysis of part a) under the revised rate and comment on your findings.
(4 marks)
(TOTAL 20 MARKS)
. Company Valuation
a) Raglan Stores PLC has grown rapidly since its stock market flotation five years ago. Despite its rapid growth the company has been able to finance all its new development from retained earnings and employs no debt in its capital structure. The company’s earnings for the year that has just ended was 80€ MILLION, a new high, and with 200 million shares outstanding this produced EPS (earnings per share) of 40p. Last year the company re-invested 80% of its earnings and recorded a rate of growth of earnings 32%, well above the minimum rate of return of 20% sought by investors in its sector of the market. Exactly this growth is also expected for next year for the earnings.
The company has now opened stores in all the larger cities in the UK and new stores it plans to open will be located in towns with smaller markets that will produce lower turnover and profits per store. For the next 4 years or so it is anticipated that expansion will continue to be profitable, but less so than in the past even if the process is managed with the same degree of efficiency that has characterised the company’s development over the last few years. As the coverage of the UK market becomes more complete it is planned to reduce the amount of annual investment. It is anticipated that the company will again invest 80% of its earnings next year, 60% of its earnings the following year and 40% the subsequent year.
It is expected that the rate of return on new investment will fall to 35% next year, 30% the year after, and 25% three years from now. After the next three years management believes that there is unlikely to be scope for any investment offering internal rates of return of more than 20%. With the disappearance of opportunities for profitable growth it is intended in 4 years time to increase the dividends to 75% of earnings.
Required : - Estimate the value of the company using both the dividend and earnings based models, as well as the current price of the company’s shares. Set out the assumptions on which the models are based and discuss how appropriate they appear to be in this context. Determine the contribution of Growth opportunities to the estimated value of the company. (8 marks)
- How would the value of the company change if the required Rate of Return was 15% ? Alternatively
if it was 25% ? Comment on your reply. (2 marks) - Determine the expected price/earnings ratio today. Explain the determinants of the PE in reference
to the two valuation models used. (3 marks) - A member of the board suggests identifying an appropriate price-earnings ratio for Raglan Stores and using this as a multiplier to derive a value for the company. Comment on this suggestion.
(2 marks) - The government issued a 15 year bond offering an interest rate of 12 per cent 10 years ago. Since then interest rates have fallen sharply. The bond now has five years to run to maturity and the government has just issued a five year bond offering an interest rate of 6 per cent. Determine a value for the bond that has five years to run to maturity, assume the bond has a face value of £100 and
interest is paid annually. Explain your answer. (5 marks)
(20 MARKS) - Portfolio Theory and Analysis
The attached file (MFR & FFM Ass Returns Data.xls) gives 120 months returns for securities drawn from the FT ALL share index as well as the returns on the FT ALL share index for the period January 2009 and December 2018.
I.
a) Choose any five securities at random and determine the average returns for each company for the 120 months along with the variance and standard deviation of these returns. Next construct an equally weighted portfolio made up of the five securities, and determine the series of monthly returns. On this basis determine the average return for the portfolio and the associated variance and standard deviation. The averages, variances, and standard deviations can be derived using the relevant Excel functions. Utilise the Excel specification for population variance and standard deviation – STDEVP and VARP – in the calculations. Explain the discuss the relationship between the average returns, average variance, and average standard deviation for the five securities and the average returns, variance, and standard deviation for the portfolio. (4 marks)
b) Calculate the co-variances for each pair of securities in the portfolio and on the basis of this information, and using the relevant portfolio equations, calculate the standard deviation of the returns on the portfolio using the equally weighted portfolio risk equation. Compare your results to those obtained for the portfolio in part i above. Comment and explain your findings.
(4 marks)
c) Choosing securities at random form equally weighted portfolios of 2, 5, 10, 15 and 20 securities determine the standard deviation of these portfolios and plot the standard deviations against the number of securities in the portfolios. Comment on your results and compare these with the results of the studies of naïve diversification. (In undertaking this analysis you can derive the results for each of the portfolios using the Excel spreadsheet – there is no need to employ the portfolio equations and estimates of co-variances etc.
(4 marks)
d) Choose 2 companies from different sectors of economy and determine the beta of each one security by regressing the returns for the share on the returns for the FT ALL Share Index (the last column in the spreadsheet). Comment on what the value of the beta (the slope coefficients in the regression) indicates.
i. Explain what the values of the betas (the slope coefficients in the regression) indicate and discuss the factors that might explain the differences in the values of the betas of the two companies. ii. Discuss the primary determinants of a share’s beta. (This part of the questions relates to
betas in general and does not require you to focus on the companies analysed in parts a,
b and c)
(Approximately 500 words) (8 MARKS)
(TOTAL 20 MARKS)
. Derivatives – Efficient Market Hypothesis
You are given the following data for a listed company as follows:
Options Traded on Legal and General
Share Price Exercise Price Calls Puts
Sep Dec Mar Sep Dec Mar
65.90 64 4.50 7.75 9.75 3.50 6.75 8.75
68 3.50 5.75 7.75 5.75 8.75 10.75
a) Draw a profit diagram for an investor in a call option with an exercise price of 64 that expires in March and explain the diagram. Undertake the same analysis for the writer of the call. Comment on the contention that options are a zero sum game for the writer and investor in options.
(4 marks)
b) Explain carefully why the March calls are trading at higher prices than the December calls.
(3 marks)
c) Draw a diagram illustrating a straddle, using calls and puts expiring in March and an exercise price of 64. Explain why an investor might consider it worthwhile to invest in a straddle and comment on the expected profitability of such an investment.
(3 marks)
d) Explain what is meant by forward contracts and futures using examples. List the main advantages / disadvantages for their use.
(4 marks)
e) Explain what is meant by the efficient market hypothesis and how tests of the hypothesis are
structured (3 marks)
f) Discuss the implications of the efficient market hypothesis for financial
managers and security analysts. (3 marks)
(TOTAL 20 MARKS) - Rights Issues – Long term Financing
Santa PLC is an all equity financed company with 100 million shares outstanding trading at €2 per share. Its management has decided to invest in a major new development that will cost € 40 million, and is now considering ways to finance the investment. Various alternatives have been considered but the choice has been narrowed down to a rights issue or the issue of debentures (a kind of bond).
The rights issue would be made at a discount of 20% and be underwritten at a cost of 2% of the proceeds. The company’s chairman has discussed the proposed investment and its prospects as well as the financing possibilities, quite openly with various institutions and the financial press. As a result it is likely that the share price already reflects the implications of the company’s proposed investment.
Required :
a) Determine the terms of the right issue, the ex-rights price and the theoretical value of the right.
(5 marks)
b) Demonstrate that in principle the shareholders will be equally well off by subscribing to the issue or by selling their rights. Assume the shareholder has 100 shares. (3 marks)
c) Explain the impact on the value of the right if the issue is undertaken on the specified terms and the share (cum-rights) price falls to € 1.8 shortly after the shareholders are invited to subscribe to the new issue. (2 marks)
d) Would a deep discount without underwriting be preferable to save the expense of the underwriting fees ? Management considered the possibility but decided against it as it would have resulted in the dilution of EPS. Comment on the view taken by the management.
(3 marks)
e) Evaluate the contention that the shareholders’ can expect an earnings yield of 30% on shares bought given a rights issue at a discount of 20%, and that this suggests a relatively high cost of capital. (2 marks)
f) The cost of underwriting is sometimes assessed in terms of the costs of an equivalent PUT option.
Explain and discuss this approach. (3 marks)
g) Explain and assess the view that rights issues are designed to protect the interests of
shareholders. (2 marks)
(TOTAL 20 MARKS)
. Capital Structure – MM proposition
Novelty Plc
a) A firm that has employed no debt in its capital structure in the past is considering financing a major investment programme of €1m. The firm examines two ways of financing – either by the issue of new shares or by issuing debentures. It has been advised by its merchant bankers that the bonds could be arranged at an interest rate of 10 per cent. The alternative would be an issue of equity of 250,000 shares at €4 per share. This would increase the number of shares outstanding from 500,000 to 750,000. After implementing the investment programme the firm expects earnings before interest and tax of €900,000. Given a tax rate of 35 per cent:
i. Calculate earnings per share for the debt and equity financing options at the expected earnings.
(5 marks)
ii. Calculate the level of earnings at which the two financing options will offer the same EPS.
(3 marks)
iii. Draw a “rough” graph of EPS as a function of the earnings before interest and tax for the two options.
(2 marks)
b) i) Using the Miller-Modigliani model with taxes determine the value of the company for both the Ungeared and geared financing options, and comment on your assumptions.
Assume a revised share price following the Issue of the new shares of € 3.5/share. Provide estimates of the cost of capital for the company for the different financing plans and comment of your assumptions.
(4 marks)
ii) Explain what is meant by the company’s weighted average cost of capital.
(2 marks)
iii) Explain the contention that in the absence of the tax advantages of debt the use of gearing can increase the expected rate of return for shareholders, but not necessarily increase the value of their investment
(4 marks)
(Total 20 marks)
(TOTAL 100 MARKS)
