Lenders form opinions about a company's credit risk by comparing current and future debt-service requirements to estimates of the company's current and expected future cash flows.

A farmer finds that when he produces more corn,he also has more cornstalks that he can sell as decorations.To the farmer,corn and cornstalks are:

A) complements in production.
B) substitutes in production.
C) unrelated goods.
D) inferior goods.

An investor can design a risky portfolio based on two stocks, A and B. Stock A has an expected return of 21% and a standard deviation of return of 39%. Stock B has an expected return of 14% and a standard deviation of return of 20%. The correlation coefficient between the returns of A and B is .4. The risk-free rate of return is 5%. The proportion of the optimal risky portfolio that should be invested in stock B is approximately ________.

A) 29%
B) 44%
C) 56%
D) 71%

Locus of control is the belief that what happens is not within one's control.

Which of the following best defines an expiration date?

A) A bond that can be exchanged for a fixed number of shares of stock for a specified amount of time.
B) An option granted to an employee by a company giving the employee the right to buy shares of stock in the company at a fixed price for a fixed time.
C) An option that can be exercised only on the expiration date.
D) The act of buying or selling the underlying asset via the option contract.
E) The last day on which an option can be exercised.

Bob Dresser operates a major appliance warranty service centre. His operation has two check stations that are required at the end of every repair task performed by his appliance repair staff. These are the Functionality Review (FR) and the Overall Scan (OS). The FR must be performed successfully before the OS is begun. On Friday morning, six repair jobs are completed, awaiting these two inspection activities. Processing times are given in minutes.
$$\begin{array}{ccc}\text{ Job }& \text{ FR }& \text{ OS }\\ \text{ A }& 50& 30\\ \text{ B }& 35& 55\\ \text{ C }& 25& 20\\ \text{ D }& 20& 35\\ \text{ E }& 15& 10\\ \text{ F }& 10& 25\end{array}$$ a. What is the optimal sequence of jobs for the objective of minimizing the total flow time?
b. Show your work, and document the sequence.
c. Chart the solution to this problem.
d. What jobs are being processed at time period 90?
e. What is the total flow time of this problem?
$$\begin{array}{lllllllllll}\mathrm{FR}& & & & & & & & & & \\ \mathrm{OS}& & & & & & & & & & \\ & 20& 40& 60& 80& 100& 120& 140& 160& 180& 200\end{array}$$