A new strip mall is being considered and the developers want to determine how many parking spaces there should be. It is assumed that if the lot is full, an arriving car will leave. Cars arrive at a rate of 15/hour. The average time a customer spends shopping is 30 minutes. Assume the interarrival times and the shopping times are exponentially distributed. Assume the average shopper purchases $150 worth of merchandise and also assume the mall is open 12 hours/day, 350 days/year. a) If there are 10 spaces, determine the throughput rate of cars departing after completing shopping, the expected number of cars in the parking lot and the rate of lost revenue due to cars leaving because they could not find a space to park.
b) Assume the cost to create a parking spot is $2500. Assuming a 5 year horizon and an internal interest rate of 15%, how many spots should be built to minimize the combined construction and lost revenue costs?

Neon light company of kansas city ships lamps and lighting appliances throughout the country. ms. neon has determined that through the establishment of local collection centers around the country, she can speed up the collection of payments by one and one-half days. furthermore, the cash management department of her bank has indicated to her that she can defer her payments on her accounts by one-half day without affecting suppliers. the bank has a remote disbursement center in florida. a. if neon light company has $2.90 million per day in collections and $1.18 million per day in disbursements, how many dollars will the cash management system free up?

What do you think: would it be more profitable to own 200 shares of penny’s pickles or 1 share of exxon? why do you think that?

Variable rate cd’s = $90 treasury bills = $150 discount loans = $20 treasury notes = $100 fixed rate cds = $160 money market deposit accts. = $140 savings deposits = $90 fed funds borrowing = $40 variable rate mortgage loans $140 demand deposits = $40 primary reserves = $50 fixed rate loans = $210 fed funds lending = $50 equity capital = $120 a. develop a balance sheet from the above data. be sure to divide your balance sheet into rate-sensitive assets and liabilities as we did in class and in the examples. b. perform a standard gap analysis and a duration analysis using the above data if you have a 1.15% decrease in interest rates and an average duration of assets of 5.4 years and an average duration of liabilities of 3.8 years. c. indicate if this bank will remain solvent after the valuation changes. if so, indicate the new level of equity capital after the valuation changes. if not, indicate the amount of the shortage in equity capital.