...Understanding Risk Tolerance Levels https://homeworklance.com/downloads/understanding-risk-tolerance-levels/ BUYU Manufacturing has been contracted to provide SAEL Electronics with printed circuit and motherboards (PC) boards under the following terms: • 100,000 PC boards will be delivered to SAEL in one month. • In 3 months, SAEL has an option to take the delivery of an additional 100,000 boards by giving BUYU a 30-day notice. • SAEL will pay $5 for each board it takes. BUYU manufactures the PC boards through a process called batching, and manufacturing costs are as follows: • The manufacturing batch run has a fixed setup cost of $250,000, regardless of the run size. • The marginal manufacturing cost is $2.00 per board, regardless of the size of the batch run. BUYU must decide whether it should manufacture all 200,000 PC boards now, or if it should manufacture 100,000 now and the other 100,000 boards only if SAEL decides to buy them. If BUYU manufactures 200,000 now and SAEL does not exercise its option, then BUYU will lose the manufacturing cost of the extra 100,000 boards. BUYU believes that there is a 50% chance that SAEL will exercise its option to buy the additional 100,000 PC boards. 1. Discuss the potential profit of manufacturing all 200,000 boards now. 2. Draw a decision tree for the decision that BUYU faces. 3. If BUYU uses its expected profit as the basis for its decision, determine the preferred course of action. 4. Determine the range of values of...
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...Controlled Environments’. It’s about top-down management and tight control, especially of any proposed changes to project scope / requirements. PRINCE2 entails having a clear understanding of the project business case, comprehensive project documentation with detailed, signed-off requirements, clearly defined accountability and responsibilities and high level decision making. PRINCE2 is not industry specific and can be used to direct and manage a project of any size or complexity. ‘Die hard’ PRINCE2 practitioners, especially those who have managed very large scale projects, tend to be highly suspicious of agile methods, believing it puts ‘developers in charge’ and does away with project management controls, making the project impossible to plan or cost. In fact what is the role of a project manager on an agile project and perhaps Agile should only be applied to small, low risk projects? AGILE is a term used (in the IT Industry) to describe a broad collection of different methods / approaches, such as ‘Kanban’ and ‘Scrum’. It came about to try to improve the ability of IT projects to respond to, even welcome, changing requirements. Agile methods advocate self organising, empowered teams who develop software in frequent, short time-boxed iterations with only high level requirements agreed up front and lower level requirements...
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...Investment strategy evolves over time depending on the life stage, risk tolerance and major life events that are occurring or expected to occur. Asset allocation can reduce overall portfolio risk and it should be based on the individual’s risk tolerance, financial goals including risk-return expectation and time horizon (Indian Express, 2011). Asset allocation refers to the distribution of three different asset classes within an investment portfolio: cash investments for security, bonds for income and stocks for growth (The Times - Transcript, 2011). In general, a portfolio should include a higher mix of stocks when risk tolerance is higher and the timeframe for investing is longer. Younger investors who can tolerate a higher level of risk to achieve potentially better returns should have a higher portion of their portfolio in stocks as these are growth investments (Watkins, 2011). As risk tolerance is reduced, investors can consider having the same proportion of stocks in their portfolio but diversifying the stocks to include holdings with traditionally lower risk. Diversifying the stock holdings can reduce the beta of the portfolio, but as the investment timeframe shortens as it does when retirement nears, investments should be shifted to asset classes that are less risky including cash and bonds (Krantz, 2011). Many “target date” funds have been set up to adjust the weighting based on the timeframe to retire. The least risky portfolios still should include a growth...
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...SOLD TO THE FINE kaptoxic@yahoo.com THE OPPORTUNITY ANALYSIS CANVAS Dr. James V. Green Copyright © 2013 by Venture Artisans Press All rights reserved. No part of this book may be reproduced in any form, by Photostat, microform, retrieval system, or any other means, without prior written permission of the publisher. www.opportunityanalysiscanvas.com Publication Data Green, James V. The opportunity analysis canvas / James V. Green Edition 1.0 1. Entrepreneurship 2. Innovation i For Jamesia and Ally Thank you for giving me the opportunity every day to be a husband and dad. ii ABOUT THE AUTHOR An award-winning educator at the University of Maryland, Dr. James V. Green leads the education activities of the Maryland Technology Enterprise Institute. As its Director of Entrepreneurship Education, he manages 25 undergraduate and graduate courses in entrepreneurship, innovation, and technology commercialization. He has created and led a host of innovative programs and activities to serve 100,000 innovators and entrepreneurs from 150 countries. With 20 publications, he is a thought leader in entrepreneurship education pedagogy and entrepreneurial opportunity analysis. In 2011, he earned first prize in the 3E Learning Innovative Entrepreneurship Education Competition presented at the United States Association for Small Business and Entrepreneurship (USASBE). In 2013, he launched the University of Maryland’s first course with Coursera, “Developing...
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...should identify these goals with your financial adviser so that his or her recommendations will directly address your needs. (See the CFA Institute fact sheet “Managing the Relationship between You and Your Adviser” for more information on how to effectively communicate with your adviser.) Risk Tolerance Risk is often defined as portfolio volatility, or the fluctuation in the value of your assets over time. At a personal level, risk can mean the chance that you won’t achieve your goals or the risk of losing your savings. Understanding your tolerance for risk, which differs for each investor, is key to choosing an investment program. Your tolerance for risk is a very personal characteristic that may be difficult to determine and may change over time. Your emotional make-up plays a role in your willingness to take risk. But your objective ability to bear risk, given your wealth and financial needs, is important too. Your age may also affect how much risk you can assume: As you become older, there is less time to recover from poor investment results and your appetite to take risk may change — but your wealth and circumstances will probably change too. You may also have different risk tolerances for different parts of your portfolio, for example, money intended for retirement and educational funds for...
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...also called driving under influence is a crime because it is illegal to drive with blood levels of alcohol in excess of a certain limit. Drivers having high blood alcohol content (BAC) are at higher risk to death or injuries due to accidents. According to National Council on Alcoholism and Drug Dependence, Inc. 32 percent of accidents are the results of drunk driving (NCADD, 2014). In America drunk driving has taken lives of many citizens the drivers not only hurt their selves but also are threat to other’s safety. In the year 2000, 16,653 accidents occurred due to using alcohol during driving. Due to drunken driving almost 17,274 people were killed in 1995 (PBS, 2002). Moreover almost one million people are injured due to alcoholic driving (PBS, 2002). Alcohol is the major cause of accidents and more deaths are likely to occur due to use of alcohol during driving as compared to instances where alcohol was not used. Alcohol when take in absorbs quickly throughout the body fluids and affect physical ability of a person. It affects the vision and reduces peripheral vision. During driving a person has to be more active and attentive but alcohol can make sleepy and confused. It is hard to track visual search and number monitoring during driving. Alcohol affects the brain greatly so you lose control over your speech and walk and ability to think and memorize is also weaker. At 0.08 BAC level a person loses his judgments, the muscles became poor in coordination and it is hard to memorize...
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...Methodology The primary goal of a risk management plan is to understand what risks the project will be exposed to. The Project team supports the premise that “risk management goals and objectives should be consistent with and supportive of the enterprise’s business objectives and strategies.” Therefore, the risk management plan associated with this expansion utilizes the company’s vision and strategic objectives as its foundation. The risk management plan was developed with the goal of assisting the organization in improving its current capacity to identify, prioritize, and respond to the risks associated with the expansion in to China. As previously stated the primary objective of the risk management plan is to increase the organization’s understanding of the risk associated with this expansion project. In order to effectively utilize risk management the risk management plan must develop a “common understanding” of these risks. The benefits of a common understanding of risk across the organization structure are numerous. For instance, the risk management plan will help to achieve cost savings through better control of both internal and external resources. One way this control will be realized is by developing safeguards that impact the organization’s earnings. This cost savings then makes it possible for the organization to allocate capital more efficiently. Development of the risk management plan utilized the project’s Scope Statement, Cost, Schedule, and Communication...
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...Risk Management – Kentucky Farm Bureau Insurance Christopher Peer CMGT/582 – Security and Ethics John Harvey Overview Kentucky Farm Bureau Insurance is challenged to align security with business requirements. Business operational and financial integrity alongside compliance mandate that adequate and appropriate policy, operational and technical controls are in place to protect the organization and its information assets. To validate that its security and risk management program is effectively managed to business requirements, KFB relies on an effective risk assessment program to evaluate information security, set priorities, identify weaknesses and shortcomings in current processes, and define changes to improve the overall effectiveness of the security program. KFB frequently compares their information security program to others in the same industry sector to provide appropriate guidance on strengths and deficiencies in the program so they can maintain an appropriate level of information security for their business. The Assessment Approach The Kentucky Farm Bureau risk assessment program is based on industry best practices in the areas of information security and risk management. These practices are first introduced to key management and security personnel to develop proper methods for improving the information security program. The assessment starts with the data gathering phase to collect data that will be used to adapt the assessment data model to the KFB environment...
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...When we think of risk management techniques, our first thoughts are to evaluate what are risks are then create value by purchasing insurance to protect potential financial loses. Others start creating financial nest eggs by placing money into savings. While both techniques are valid techniques, they are but pieces of a larger risk management pie that requires techniques to consider when looking into solutions for optimal risk management. There are many perspectives on how to manage financial risk but for the purpose of this analysis I will be evaluating two specific experts Dr. James Kallman and Robert S. Kaplan and Co-Author Annette Mikes on their techniques for managing risk. Dr. Kallman utilizes a risk management solution tree which involves the GEICO approach, these risk prevention techniques include: Government mandates, Education, Information management, Contractual Transfer, and Operations Management; these techniques preserve assets, save lives, and save risk financing costs. In analyzing Robert Kaplan & Annette Mikes techniques requires a qualitative distinction between the risk levels in order to properly categorize them as Preventable risk, Strategy Risks, or External Risks, with the belief that we can influence risk by not buying into standard forecasting and biases which leads to misreading ambiguous threats. After analyzing both Dr. Kallman’s assessment of Financial Risk Management techniques and comparing to Robert S. Kaplan & Annette Mike’s techniques I believe...
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...000 lives have been saved because of the MLDA (minimum legal drinking age). When states had lowered drinking ages in the past, the underage drinking problem was worse than ever before in the US. To have a better understanding on the controversy around the legal drinking age, some background information may be helpful. Kids are now experimenting with alcohol at early ages than they have ever before. Teens who are drinking can be affected in many different ways. Alcohol has been linked to a wide range of illnesses such as cancer, high blood pressure and liver disease. Some studies and surveys have shown that between the ages of 12-21, young adults have consumed alcohol at least once. Every year there are about 5,000 deaths in young people as a result in underage drinking. However with the ratings and percentages of teens drinking there are some ways to educate and possibly prevent the negative outcomes. A survey taken in 2004 showed that students “who completed AlcoholEDU were 20% less likely to be heavy-episodic drinkers and 30% less likely to be problematic drinkers” (Teens at Risk 173). These numbers “prove that alcohol education can be a useful tool in altering students drinking habits” (Teens at Risk 173). Having a higher MLDA will help decrease the risk of teen suicides,...
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...Pathophysiology * The underlying pathophysiologic defect in type 1 diabetes is an autoimmune destruction of pancreatic beta cells. Following this destruction, the individual has an absolute insulin deficiency and no longer produces insulin. Autoimmune beta cell destruction is thought to be triggered by an environmental event, such as a viral infection. Genetically determined susceptibility factors increase the risk of such autoimmune phenomena. * About 90% of diabetic Americans have type 2 diabetes. The prevalence of type 2 diabetes is higher in African Americans, Native Americans, Hispanics, and Pacific Islanders than it is in Caucasians. Most type 2 diabetes patients are overweight, and most are diagnosed as adults. The genetic influence in type 2 diabetes is greater than that seen with type 1. While concordance rates between monozygous twins for type 1 diabetes are about 30 to 50%, the rate is approximately 90% for type 2 diabetes. Although the genetic predisposition to type 2 diabetes is strong, no single genetic defect has been found. In addition to genetic influences, acquired risk factors for type 2 diabetes include obesity, advancing age, and an inactive lifestyle. CLINICAL MANIFESTATION * Type 1 Diabetes: About 5 to 10 percent of those with diabetes have type 1 diabetes. It's an autoimmune disease, meaning the body's own immune system mistakenly attacks and destroys the insulin-producing cells in the pancreas. Patients with type 1 diabetes have very little or no insulin...
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...Understanding an Organization's Culture Goal: This activity is designed to help you identify the dimensions of an organization's culture and acquire more than a simple definition of these concepts. * Wal-Mart appears to be well structured. They do their best every day to provide the greatest possible level of service to everyone they come in contact with. Their power distribution and job autonomy is great. Their beliefs are the foundation of their culture: service to their customers, respect for the individual, striving for excellence and acting with integrity. Wal-Mart sociability is described as the importance of respect for every associate. They also have encourage opportunities for growth and rewarded employees accomplishments. The key to their success is constantly looking for ways to improve themselves and improve their business. They strive to lead not just their industry, but also each associate to the next level of success. Wal-Mart’s tolerance for risk and change is to be objective by making decisions based solely on Wal-Mart’s interests while operating in compliance with all laws and their policies. Wal-Mart’s conflict tolerance is to be honest by telling the truth and keeping your word. Last but not least, Wal-Mart’s emotional support is to be fair and open when dealing with associates, suppliers and other stakeholders. Then, answer the following questions: 1) Define the eight dimensions of organizational culture described in the text. * Sociability-...
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...or difficulties. Along with methods to overcome setbacks or difficulties, and outcomes used to measure success. Also including the plan’s effectiveness, and identifying potential health risks that may develop if the plan is not implemented. When following a plan one has to accept that over time it will have to change as the body ages, changes, and other physical or medical problems come into the picture. Iron-deficient anemia is that the body lacks the mineral iron which causes the decrease of or faulty red blood cell production (Bryg, 2010). Red blood cells are responsible for transporting oxygen to organs and muscle tissue if they are lacking hemoglobin, which happens with anemia, and the organs and muscle tissues are not obtaining enough oxygen to perform correctly (Bryg, 2010). Bone marrow, in the center of the bone, needs iron to make hemoglobin (Bryg, 2010). Iron-deficient anemia is caused by an iron-poor diet, the metabolic demands of pregnancy and breastfeeding, menstruation, frequent blood donation, endurance training, digestive conditions, and certain drugs, foods, and caffeinated drinks (Bryg, 2010). Ways nutrition and physical exercise goals can help keep one’s iron levels normal or as close as one can get. Nutrition plays a major role in keeping a person’s iron levels where it needs to be for the body to produce enough...
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...or market crashes For Income, ie to receive regular income from their investments For Growth, ie for long-term growth in the value of their investments Investments are generally structured to focus on one or other of these objectives, and investment professionals (such as fund managers) spend a lot of time balancing these competing objectives. With a little bit of education and time, you can do almost the same thing yourself. Knowing Yourself – Your Risk Profile One of the first questions to ask yourself is how much risk you’re comfortable with. To put it more plainly: how much money are you prepared to lose? Your risk tolerance level depends on your personality, experiences, number of dependents, age, level of financial knowledge and several other factors. Investment advisors measure your risk tolerance level so they can classify you by risk profile (eg, ‘Conservative’, ‘Moderate’, ‘Aggressive’) and recommend the appropriate investment portfolio (explained below). However, understanding your personal risk tolerance level is necessary for you too, especially with something as important as your own money. Your...
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...Introduction Enterprise Risk Management is defined1 as: “A process, affected by an entity’s board of directors, management and other personnel, applied in strategy setting and across the enterprise, designed to identify potential events that may affect the entity, and manage risk to be within its risk appetite, to provide reasonable assurance regarding the achievement of the entity’s objectives.” In summary, ERM: * Forms a basis for the credit union’s decision making processes from the development of its strategy and objectives to its daily operations, reporting and compliance routines; * Provides the ability for management to make more efficient use/allocation of capital and resources within the organization to optimize capital levels. * Optimizes risk management by balancing the cost of risk with the cost of control for all aspects of the credit union’s potential risk areas to ensure organizational objectives are met. * Seeks to enhance value and preserve the longer term viability of the credit union. The importance of enterprise risk management Value is created by informed and inspired management decisions in all spheres of an entity’s activities, from strategy setting to operations. Entities failing to recognize the risks they face, from external or internal sources and to manage them effectively can destroy value – in absolute or relative terms for shareholders and other stakeholders, including the community and society at large. For companies,...
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