Excel

IMPORTANT INSTRUCTIONS

There are three parts (part A, B and C) with multiple questions in this homework. Please read the gvien instruction carefully. Part A. Using the following information from a farm operation, please perform DuPont analysis for four different scenarios [Also, remember to answer short questions in respective worsheets]. Gross Revenues $230,678 Variable Expense $100,467 Fixed Expense $50,811 Interest Expense $5,590 Other Income $0 Total Assets $850,060 Total Liabilities $80,032 Scenario I: Go to “Question 1 Scenario I” worksheet and perform Dupont Analysis for Base Scenario using the exact same information from above. Scenario II: Go to “Questions 2-3 Scenario II” worksheet and perform Dupont Analysis if revenue from base scenario goes down by 25%. Also, answer question 3. Scenario III: Go to “Questions 4-5 Scenario III” worksheet and perform Dupont Analysis if off farm income in base scenario changes to $30,000. Also, answer question 4. Scenario IV: Go to “Questions 6-7 Scenario IV” worksheet and perform Dupont Analysis if variable expenses from base scenario goes down by 15%. Also, answer question 5. Part B. Using the information "Questions 8-12 BE Analysis" worksheet, please perform break even alaysis using the given information. You need to provide your answers for questions 8-12. Part C. Using the information "Questions 13-14 Risk and Return" worksheet, please perform risk and return analysis.

Questio 1 Scenario I

Questions 2-3 Scenario II

Quesion 3. Explain why ROE in Scenario II is different than Scenario I? In particular, please indicate which componet(s) of DuPont model is (are) mostly affected by change in revenue and by how much?

Answer 3.

Questions 4-5 Scenario III

Quesion 5. Explain why ROE in Scenario III is different than in Scenario I? In particular, please indicate which componet(s) of DuPont model is (are) mostly affected by change in off farm income and by how much?

Answer 5.

Questions 6-7 Scenario IV

Quesion 7. Explain why ROE in Scenario IV is different than in Scenario I? In particular, please indicate which componet(s) of DuPont model is (are) mostly affected by change in variable expenses and by how much?

Answer 7.

Questions 8-12 BE Analysis

Question 13-14 Risk and Return

Question 13. Here are NFI for three different farmers. Calcuate (in the green cells) expected NFI, standard devation, and coefficient of variation for each farmer. Assume standard normal distributions on returns.

Answer 14.

Question 14. Based on your calculations above, which farmer has lower relative risk on returns? Why (answer interpeting CVs associated with each farmers)?

Grade