Explanation:
Company Y has created an interconnected network of digital products and services, involving various partners, to enhance value for customers. This arrangement resembles a digital ecosystem, where different elements interact to provide comprehensive solutions and services to customers.
Explanation:
Budgetary slack involves intentionally inflating expenses or deflating revenues to make it easier to achieve budget targets. This practice can provide a cushion for unexpected expenses or allow for easier goal attainment, but it can also lead to inefficiencies and mismanagement if not carefully monitored.
Explanation:
In the BCG matrix, a "Star" represents a business unit with a high market share in a growing market. Despite the overall market decline, if the unit's revenues have increased due to a successful marketing campaign, it suggests that the unit is performing well in its market segment, making it a "Star" in the portfolio.
Explanation:
Return on Capital Employed (R.O.C.E) measures a company's ability to generate profits from its capital. It indicates how efficiently a company is utilizing its capital to generate earnings. Therefore, R.O.C.E would provide Juan with insights into which company is utilizing his investment more effectively.
Explanation:
Explanation: AAA is engaging in activities that influence government policies and regulations to gain a competitive advantage. This falls under the realm of non-market strategy, which involves actions taken outside the traditional market environment to shape the rules of competition in favor of the company.
Explanation:
To calculate the equivalent annual cost (EAC), you divide the net present value (NPV) by the present value annuity factor (PVAF) for the given number of periods at the given discount rate. In this case, EAC = 6,340 / 3.170 ≈ 2,000.
To find the present value of the cost in perpetuity, you divide the net present value by the perpetuity factor. Here, the perpetuity factor is simply the discount rate (0.10) because the payments continue indefinitely. So, the present value of cost in perpetuity = 6,340 / 0.10 = 63,400.
Therefore, the correct option is the one stating:
Equivalent annual cost = 2,000
Present value of cost in perpetuity = 20,000
Explanation:
To find the percentage drop in revenue that the project can afford before becoming unviable, we divide the NPV by the total expected revenue ($61.42m / $400m = 0.15355). Then, subtract this from 1 to find the percentage (1 - 0.15355 = 0.84645 or 84.645%). Finally, subtract this from 100% to get the percentage drop (100% - 84.645% = 15.355% or 4.05% rounded). So, a 4.05% drop in revenue would render the project unviable.
Explanation:
While YC Hospital achieved excellence, effectiveness, and efficiency by achieving high success rates, conducting a record number of operations, and reducing the average cost per patient, it did not manage to achieve economy. Economy refers to minimizing costs, and since overall spending increased significantly despite cost reduction per patient, YC Hospital did not achieve economy.
Explanation:
Correcting an underestimation of the discount rate will decrease the present value of future cash flows, leading to a reduction in the Net Present Value (NPV). However, the Internal Rate of Return (IRR) remains unchanged because it is independent of the discount rate used for analysis.
Explanation:
A flexible budget is designed to adjust or flex based on changes in the level of activity. It allows for variations in activity levels and adjusts the budgeted figures accordingly to reflect these changes. This flexibility enables better cost control and performance evaluation, as it provides a more accurate comparison between actual performance and budgeted amounts.
Explanation:
Building a guiding coalition is about assembling a group of influential individuals who can provide direction, support, and momentum for the change initiative. They help ensure that the change effort stays on track and has a clear sense of purpose and direction.
