Case: Manzana Insurance Background: Manzana Insurance is faced with losses in the last 2 quarters and declining profits over the last 5 quarters. There are many potential problems in the operations processes of Manzana Insurance. Firstly, the Turn Around Time(TAT) is high at an estimated 6-8 days compared to the competitor who had been maintaining a TAT of 2 days, and is now promising to bring it down to 1 day. Secondly, the Renewal Loss Rate has increased from 33% to 47% over the last quarter. Thirdly, there is uneven distribution of workload amongst underwriters.
We see this again from 2004 all the way to 2010 with unemployment increasing to 10%. We can see that the economy hits a recession after roughly 10 years of gradual expansion. Okun’s Law states that for every 1% rises in Unemployment, GDP decreases by roughly 3%. The above Scatter Plot chart shows data from 1981 to 2010 and we can see that for every 1% rise in Unemployment over this period, GDP dropped by 0.4%. This shows a negative slop and that the relationship is relatively weak due to the fact the GDP has decreased by less than 1%.
1. Does the Audi division of Volkswagen appear to be achieving economies of scale, constant economies of scale, or diseconomies of scale? At first glance it would appear that Audi is experiencing diseconomies of scale. As diseconomies of scale occurs when a company experiences an increase in marginal cost when output is increased. Audi's global sales rose 8.3% to 1.58 million vehicles in 2013 however despite the increase in revenue, the net profit fell 7.7% ($5.57billion) and the operating profit margin fell to 10.1% from 11% the previous year.
An Analysis Of The 2001 Recession An Economic Analysis of the 2001-2002 Recession The recession is commonly defined as “Two or more consecutive quarters of a shrinking economy.” During the month of March 2001, the world’s largest economy - The United States of America - began experiencing a downturn, leading into a recession. (“Economists call it recession”). In comparing previous recessions that occurred, it appears that similar patterns exist also in the 2001-2002 recession. Such patterns start with increasing interest rates by the Federal Reserve Open Committee, proceeded by growth slowdowns, the fall of real output, and eventually the rise in unemployment. According to Robert E. Scott and Christian Weller, “further increases in real short - term interest rates herald a slowdown.” Further evidence that suggests a recession was on the horizon was information released from the National Bureau of Economic Research that states, “A peak marks the end of an expansion and the beginning of a recession.”(The Business Cycle Peak, March 2001.)
ACG: 6065 Accounting Foundations Case 11-1 The Medieval Adventures Company Submitted By- Case:11-1 The Medieval Adventures Company 1. The Medieval Adventures Company goes into negative cash in the month of April. This is when the Company needs extra funds. July is the last month which shows a negative cash flow i.e. negative 2500 $.The company needs to raise about 40,000 $ as the ending cash balance for the month of July is negative 40,000 $.
Also, it can be seen the earnings per share were down by 12% and the return on average capital was down by 10%. However, net sales were up by 2%, and share holder’s equity was up by 25%. (About PPG, 2013) PPG Industries For The Year 2012 2011 2010 In Millions Except for per shares Current Assets $7,702 $6,694 $7,058
The company’s cash and cash equivalents started the year with $12.66B and ended with $9.58B, a 24.83% drop during the year. This was quite different than the previous year. In 2011 cash and cash equivalents began with $7.82 B, but increased by an impressive $4.84B, or 61.9% during the year. Stock price for ExxonMobil (XOM) ended on April 26, 2013 at $88.00. Over a two year period, the
When comparing the financial results of the companies, it can be said that The Gap Company is the largest competitor among others for Inditex. The Gap has the highest net operating revenues which is around five times Inditex numbers. Therefore, I think The Gap is the most interesting international competitor to compare. Despite the fact that it has the highest revenue, The Gap had a massive decline in its stock prices in 2001 and as a result the company incurred a net loss of 9 million euros. On the other hand, Inditex has achieved net income of 340 million euros in 2001 with relatively such small revenue.
Procter & Gamble Case Analysis Financial Stagnation: In this case study, Procter & Gamble (P&G) has experienced disappointing financial reports for the year 1999-2000. Profits, excluding reorganisation costs, grew by only 2 %, to $4.23bn, and it’s flagship brands endured disappointing growth, causing the company to scale back its growth forecasts. (Jones, 2001) P&G has responded in two ways. Firstly, it has acquired Clairol, the shampoo and hair-colouring business, for $4.95bn. This led to a 4% drop in share prices.
At 10 cents each, the expected revenue of $500 per day, and the amount will be lost while the copier is broken. The standard number of breakdowns per year to be 12.255 (dividing 52 weeks/year by 4.243 weeks/breakdown), the profit lost per breakdown to be $1,125 (days lost/breakdown * revenue lost/day), and finally the profit lost per year due to breakdowns to be $13,787 (breakdowns/year * profit lost/breakdown). 6. The profits lost per year due to breakdowns is $13,787, which is bigger than $12,000, they should procure a backup copier. A high