Which of the following is an implication of a mass production system?
A. It results in short production runs.
B. It fails to realize economies of scale.
C. It reduces the number of defects and eliminates waste.
D. It helps to accommodate consumer preferences for product diversity.
E. It creates massive inventories that have to be stored in large warehouses.
E
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Under MACRS, an asset which originally cost $10,000 is being depreciated using a 5-year normal recovery period. What is the depreciation expense in year 3?
A) $1,900 B) $1,200 C) $1,500 D) $2,100
George wants to pick a stock for his Diversified Hedge Fund. The fund has holdings in every country with a stock market. George is trying to decide which asset he should add to his portfolio: Stock A or Stock B
Expected return, Standard deviation and beta values for the two stocks are outlined in the table below. Which stock is best for George's portfolio and why? Stock A Stock B Risk-Free Asset Expected Return 8% 12% 5% Standard Deviation 12% 22% Beta 1 2 A) Stock A because it has a lower Beta. B) Stock A because it has more return per unit of standard deviation. C) Stock B because it has a higher return. D) Stock B because it has a higher Treynor Index with respect to standard deviation. E) Stock B because it has a higher Treynor Index with respect to Beta.