Finance Answers

Mr. Manohar is married and have two kids. He has recently undergone a surgery, which made him think about the financial security for his dependents after his death. Hence, he decided to meet his friend who was an insurance advisor to understand the life insurance policy and the various benefits attached to with this policy .Explain Mr .Manohar on life Insurance policy with its need. 

Vaishali is working as an actuarial in an insurance company. Few of the new joiners have been appointed as an underwriter in their department. Vaishali’s manager asks her to prepare a short presentation on the various methods used by them in calculating the premium rate. Help Vaishali to complete the assigned task. 

You have studied Business Ethics in a structured manner in this program. Has it helped 

you with tools to better manage your decision making process as a business person? 

Explain in your own words. 

The loan amount is 200,000, the down payment is 20,000 and the loan term is 30 years. The interest rate is 5%. To get the 30-year mortgage at 5%, we must pay 2 points at the time of closing. What is the cost of 2 points on the mortgage?

Cost and production data for Rob Manufacturing for the 2018 financial year was as follows:

Budgeted variable factory overhead $120,000

Budgeted fixed factory overhead $180,000

Total $300,000

Budgeted production (direct labour hours) $15,000

Actual variable factory overhead $125,300

Actual fixed factory overhead $164,700

Total $290,000

Actual production (direct labour hours) 15,500

It is organisational policy and procedure that Factory overhead is applied to production using direct labour hours as the cost driver.

Required:

(a) Calculate the factory overhead application rate, and,

(b) Under or over applied overhead.

Domestic cows can be bought for $200 each but Hybrid cows cost $500 each. The domestic cows produce 30 gallons of milk per week and the Hybrid ones produce 50 gallons of milk per week. A gallon of milk can be sold for $3. A cow costs $100 per week to feed. If the financial constraint is to spend $8000 for cows and the capacity constraint is that total number of cows to be bought cannot exceed 20 cows. Formulate a linear programming model for this problem and find the optimal combination of domestic and hybrid cows that maximize the total profit earned using the graphic Method 

Describe at least three ways that you can maximize the growth of your investment over time. Do the following calculations to help you determine what factors will help your money to grow, and use your results from these calculations in your response to this question.

• invest $5000 at 4.5% simple interest versus 4.5% compound interest (quarterly), and compare the results after 5 years
• invest $2500 at 4.5% compound interest versus $5000 at 4.5% compound interest, and compare results after 5 years with quarterly compounding
• invest $5000 at 4.5% compounded monthly versus 8% compounded monthly, and compare results after 5 years
• invest $5000 at 4.5% compounded monthly for 5 years versus 10 years, and compare results

Again, the purpose of this question is NOT for you to simply do calculations, but to analyze your results, and explain what you can do as an investor to help your money grow. Your response should be a paragraph with numbers in it, not simply numbers.

“Accounting is supposed to be an aid to management – accounting is not something to be done as an end in itself.”

a) Explain the above statement based on your understanding

Consider a 6-months futures contract on gold. We assume no income and that $1 per ounce per 6-months to store gold, with the payment being made at the end of the period. The spot price is $1620 and risk free rate is 2% for all maturities. How can an arbitrageur earn profit is the price of 6-month gold futures is 1630$?