Is the use of a monthly average price a net advantage or disadvantage to J & L? Using NYMEX contracts will minimize the asset mismatch aspect of basic risk, along with a better liquidity. However, since diesel fuel is not a traded commodity, it cannot be directly hedged and J&L will suffer a certain amount of basis risk. J&L will also need to post a margin for their future contracts at NYMEX. Using product offered by Continental Bank would require a higher cost for J&L, and illiquid compared with NYMEX.
ECON151 1) The figure above shows the market for gasoline. The government has imposed a tax on gasoline. a. What is the amount of the tax per gallon of gasoline? b.
New contribution margin = $70 Break-even point in passengers = fixed costs/contribution margin Passengers = 45,000 Train cars = 715 e) Springfield Express has experienced an increase in variable cost per passenger to $ 85 and an increase in total fixed cost to $ 3,600,000. The company has decided to raise the average fare to $ 205. If the tax rate is 30 percent, how many passengers per month are needed to generate an after-tax profit of $ 750,000? Before Tax Needed Profit = $1,071,428.57 Before Tax Needed Contribution Margin = $4,671,428.57 Contribution Margin per Customer = $120 Number of Customers Needed = 38,928.57 Whole Number of Customers Needed = 38,929
For example, Fernetti Conductor has a specific budget for advertising, purchasing, sales production and cash budget. Then, each budget should be compiled into a master budget for the operations of the entire company. The consequences of telling the president of gross miscalculation are as follows; 1) The sales budget predicts the number of units a company expects to sell. Therefore, by inform the President that sales projection is overstated; he can correct his statement by telling the audience the new target units that shoul be produced by the company. 2) The sales budget calculates how much the company will spend to produce the required number of units.
And how? The moment there is speculation that crude will be trading higher, retailers usually increase their prices in an attempt to keep their margins intact for future purchases. Contrarily, when the price of the crude decreases, retailers are not inclined to lower rates as fast as they have raised it in order to maximize profits.” (Austin, 2011) So you can say when the price of oil is rising, the merchants have a small opportunity to gain a profit. Yet when the prices are low, they utilize this to take a advantage of the situation and delay the lowering of prices at the pump. It might be acceptable from their point of view for this reasoning.
According to P&Gs global-financing strategy expressed by Erik Nelson, Mexico fall into the medium risk category. This means that the country has high local-currency interest rates something that leads to low inflation rates and therefore low devaluation of the domestic currency. In some cases the risk for devaluation is so low that borrowing money in a foreign country with lower interest rates can lead to great savings for a company. History Mexico experienced rapid increase in inflation in the late 1970s because of the discovery of a large oil field. The
A branch pipeline of this nature would typically cost between $1.8MM to $1.9MM, and with estimated annual operating and maintenance cost of about $8K-$9K. We can also assume a variable cost of $40.00/delivered ton. Industry standard would indicate that PH’s IRR would need to yield an 18% return on their capital investment for the life expectancy of this project. OP’s current daily average of spot ethylene gas purchase is between 35-36 tons. The average value (Exhibit 1 red line) represents the cost savings realized by Ohio over the total daily tonnage.
This same scenario can be stated with cities that are outside the state of Wisconsin. The same driver with the same driving record varies for instance; a driver from Eau Claire pays $700 a year, while that same driver will pay$4,000 a year for auto insurance. Drivers in Los Angeles and Philadelphia pay more than $3,000 a year for insurance, while the same driver will pay little over $700 a year in cities such as, Burlington, VT, Dayton, OH, and Lubbock, TX. (Barrett.
Klass model is a good illustration of this problem and it assumes a continuous compound rate and computes fossil fuel reserve depletion times for oil, coal and gas of approximately 35, 107 and 37 years, respectively (Shahriar & Erkan, 1). Thirdly, the demand of fossil fuels is increasing. The International Energy Outlook expects a nearly 50 percent jump in global energy demand by 2035 (Cristen, 2). Using alternative energies is the best way to deal with all these three problems. It needs government’s power and civic awareness work together.
Viet Nam has the total oil reserves of 270 to 500 million tones. The production rate is 64120 cubic meters for day in 2004. Vietnam also have 3.7 billion tons of coal reserves, the coal production is nearly 19 million tons in 2003 and natural gases reserves of 13 trillion cubic meters. Viet Nam has a high amount of exporting crude fuel and importing useable fuel. Viet Nam is harvesting and using a large amount of fuel, mostly gasoline.