GDP, inflation rates, costs, return on investment

Week 1 DQ #1

The purpose of this DQ is to provide more information on concepts such as the GDP, inflation rates, costs, return on investment. As part of your first individual assignment in MyMathLab for this week, you will gain some practice on the mathematical techniques behind these concepts. This DQ helps you in a general understanding of some of these business concepts. From your readings, and general internet sources, provide a brief description of the concepts given below. Each student should pick one topic to provide their original response, and a second topic to further elaborate on another student’s original response. Your original response should be 100 to 200 words in length. Cite your sources for the information you have obtained on these concepts.

(a) GDP – what are the components of GDP, and how it is calculated.

(b) Inflation rates and how these are determined.

(d) Different types of costs – Fixed Costs, Variable Costs and how these are used to determine product costs.

Week 1 DQ #2 answer

One challenge we face on a daily basis in business is calculating decision-making information when we only know part of the information. We may need to know how much we need to determine how changes in our sales will affect our bottom line. If we know our Fixed Costs (FC), our Variable Costs per unit (VCu), our Price per unit (P), and the number of Units (U) sold, then we can use a mathematical equation to determine our Net Income (NI). In this case the formula is: NI = [U * (P-VCu)] – FC

In this equation, NI is a dependent variable and the rest are independent. What this means is, the answer to Net Income depends on what the values are for Units, Price, Variable Costs per unit, and Fixed Costs.

Each student should find another problem we may need to solve in business and the mathematical formula (also referred to as the equation) that represents the solution. You should find a problem that a classmate has not already used in the response to this DQ. You should present the equation and the variables. In the equation identify, what are the dependent and independent variables? Does the way we use the equal sign change which variables are dependent and independent? Why do we need to use this shorthand of equations so much in business?

Week 2 DQ #1

Part A. Choose any one of the following topics and post your response (100 words). Use your texts and Internet sources, citing your source(s).

Topic 1. Simultaneous equations are a set of equations containing multiple variables. Provide two examples of how simultaneous equations are used in business?

Topic 2. What is forecasting? What information is forecasted at your organization? What information at your organization is not currently being forecasted that could be forecasted to increase productivity or decrease waste?

Topic 3. What is an index? The Consumer Price Index (CPI) is one index mentioned in business news reports. What other index numbers do you feel would be helpful for organizations to run their business and why?Give two examples of indices (other than CPI) that are commonly used in Economics, Finance or other disciplines.

Part B. Review the following information and provide your response (75 -100 words) to the questions posed. Support your analysis with the data provided:

A Consumer Confidence Index (CCI) is an index based on how people feel about the economy. All indexes are created in a similar fashion. A base is first selected. For the CCI case, the base was 1985 and set at 100. Thus, if the index was at 57.2 in May 2008, and in October 1992 the index was at 54.6, are people feeling better or worse in 2008 than they did in 1992? If the index was at 62.8 in April 2008, what does that mean for May 2008 when the index was 57.2? In 2012, the CCI is 103. What does this say about the consumer confidence in 2012?

Week 2 DQ #2

Review the information in the attached Excel file. There are two sheets showing solved examples of forecasting using time series data and index based forecasting. This DQ is aimed at introducing you to use of Excel for visual graphing and regression analysis.

For Forecast#4 sheet, use data in columns B and C from rows 2 to 11 to create the scatter chart shown. You will have to explore Excel’s help function to see how to do this.
Next use the scatter chart created to obtain the Regression equation shown on the chart. Again explore Excel’s help function. Use the thread for discussion on your findings and to share your findings with the class. Next see how this equation has been used to forecast the values (in green) for 2004 and 2005.

Now use the second sheet Forecast#5 to see how the Index data has been created in Column D, and then used in columns F and G to create the scatter chart shown. The regression equation for the index data has been shown on the chart and then used to forecast the values for time periods 6 and 7.

Week 3 DQ #1

The purpose of this DQ is to provide more insights in gathering data and visual representation of data.

Part A: Create a simple question about demand for a product you dream up. For example, your product might be a dog-walking service. While we are not focused on how to write a good survey question in this discussion, you will learn that writing and testing the question is really a science itself. For now, write the question in such a way that you can determine which of four price ranges customers would be willing to pay. As a first part of your response post your product and your question.

Part B: After asking a few friends and family (which is not the best way to sample, but that is for a later class) to answer the question, post the data in a simple table format as a second part of your response.

Part C: Create a table in Excel showing the possible answers and how many people selected each answer. Graph the information using a histogram and a scatter plot in Excel as well. How does seeing the information in a graphic form provide more information? Note that you have to post the Excel spreadsheet for this response.

Your 3 part response should be 200 to 300 words in length.

Week 3 DQ #2

This DQ addresses the concept of regression equations.

Part A: Review the attached Excel file that shows an example of correlation and regression analysis. Repeat this analysis to gain practice on the same set of data provided in the example. Next use the data given below for the average share price of ColaCo and create a regression equation that can be used to estimate the share price in 2012 and 2013. Post your observations to this thread including the value of r and r-squared. You do not have to post your Excel file.

Year

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

Price

12.9135

16.8250

20.6125

20.3024

18.3160

27.7538

29.0581

36.0155

40.6111

35.0230

49.5625

48.6800

42.2200

Week 4 DQ #1

On your week 4 materials resource page, use the WEB LINK: Time Value of Money Simulation to review the time value of money concepts.

You may have won the lottery – would you use the annuity option or take the money and pay the penalty option? Where is the penalty hidden (if any) in the annuity option?
Consider the financial situation that occurred in late 2008 when many insurance companies were on the ropes financially. Also consider what happened in Cyprus recently. What risks exist with an annuity or keeping cash in a financial institution?

Post your findings from the simulation and questions on these concepts in a 100 to 150 word summary to this thread

Week 4 DQ #2

Part A: You just received a tax refund of $3000 from the IRS for 2012 and now have to decide how to grow this unexpected gift into something substantial. In the current economy, you have only three options. First, you can go to your neighborhood bank that is giving you 2% annual rate compounded monthly. Second, you can use an Internet only bank that gives you 4% annual rate but compounds quarterly. Your third choice is to use a local credit union of which you are a member and t pays a 1% annual rate compounded daily.
You have decided not to splurge for the next 3 years. So once you invest the $3000, you will let it grow for 3 years. How much money will you have at the end of 3 years with these three options? Which one is the best option for you?

Part B: Use the Microsoft Excel FV function to evaluate the options in Part A, but use the same annual rate of 2% for all 3 options. All other parameters remain the same as in Part A. Now experiment with the FV function with different rates and compounding to explore the effect of compounding and rates on the future value.

Discuss your findings in a 50 to 100 word summary – include your calculations as part of your summary.

Week 5 DQ #1

This DQ addresses the statistical measures of central tendency and dispersion. Review the Sevilla text Topic 16 and 17 for these concepts. Your original response is around 100 words.

A study to determine how fast cars travel on Main Street, which has a speed limit of 25 mph, tracked cars traveling at the following speeds:
24, 20, 32, 25, 52, 35, 28, 26, 29, 30.

Part A: Calculate the measures of central tendency and the standard deviation for this data. What measure should be used to identify a “typical” speed on this street?

Part B: Explain why you made the choice you did in part a of this exploration. What additional information if any, does the standard deviation provide you?

Note that you can use Excel functions to do these calculations. So explore these functions in Excel and present your findings, questions as part of the discussions.

Week 5 DQ #2

Review Sevilla Text Chapter 17 for the Normal Distribution concepts prior to responding to this DQ.

Verbal SAT test scores follow approximately a normal distribution and math SAT test scores also follow approximately a normal distribution.

Julie is a freshman student at a certain college and has a standardized verbal SAT test score of z = –1.3 and a standardized math SAT test score of z = 2.0. Explain what these values tell you.

Mandy is another freshman at Julie’s college who has a standardized math SAT test score of 1.5. How does Julie’s math performance compare with Mandy’s?

Suppose you also know that the mean math SAT test score for freshmen students at this college is 547 and the standard deviation is 74. What can you say about the math SAT test score of Julie and Mandy?