Tidy Finance With R 1st Edition Christoph Scheuch, Stefan Voigt, Patrick Weiss - Solutions

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describe the transition of SCM from discrete activities to networked, integrated and collaborative ecosystems;
explain the need for functional integration when making WCM decisions.By the end of this chapter you should be able to:
identify the interdependences between the three flows;
explain the need to manage the physical, information and financial flows associated with the SC;
describe the evolution of SCM;
Which function owns cash management within the organization?
Who manages the relationship with the customer?
Who is responsible for establishing customer payment terms?
Who manages the supplier relationship?
Which function is responsible for establishing supplier payment terms?
Who owns the cost of sales calculation?
Which functions have an impact on inventory policy within the organization?
explain the need to develop an inter-organizational perspective to WCM.
explain the benefits and limitations of WCM performance measures;
identify SC initiatives organizations use to manage WC components;
describe the relationship between an organization’s liquidity and its management of net WC;
identify the components of a typical C2C cycle;
Be able to calculate liquidity and net WC financial ratios;
identify the needs for liquidity and net WC in business;
explain the importance of WCM for an organization;
recognize the need to develop financially sustainable supply chains.
explain the limitations of WCM performance measures;
identify the initiatives organizations use to manage net WC components;
describe the components of a cash to cash cycle (C2C);
calculate the financial ratios used to manage liquidity and net WC;
identify the demand for liquidity and net WC;
identify the financial impact of a SCM decision on the profitability, liquidity and asset utilization of a business.
identify how SCM decisions impact on creating earnings (profits), cash and economic value for a business;
describe the impact SCM decisions have on FP;
introduce a set of financial frameworks that are used to illustrate the impact that SCM decisions have on the FP of a business.By the end of this chapter you should be able to:
explain the relationship between SCM decisions on other measures of financial performance (FP);
identify the impact that supply chain management (SCM) decisions have on the reported financial statements of the organization;
5. State the objectives and means of development finance, and identifY constraints in terms of:a) resources;b) organizations and institutions at national and intemationallevels; andc) non-economic factors.
4. Suggest relevant indicators for assessing the quality of credit rating agencies involved in country risk analysis.
3. What are the implications of exogenous economic shock-indexed debt repayment in sovereign debts, and in the assessment of country risks?
2.a) What are the policy assumptions and implications of utilizing the income elasticity of demand for imports (lED) as a measure of economic progress (as suggested, for example, in Simpson, 2002)?b) If developed countries are those with less levels of country risk, elucidate how lED and country
1. If the ratio of imports to GNP constitutes the average propensity to import, what explains:a) decline in this ratio for developed countries; andb) stationary levels of this ratio for some countries.
6. Examine the relationship between each category (of the three major classifications) of environmental resources and reduction of poverty.
5. Examine the scope and limitations of environmental taxes in a developing country setting.
4. What guidelines are necessary for the activities of the ECA in order to fulfill the objective of SD?
3. Examine the role and limitations ofDNS. Suggest potential refinements in order to revitalize and improve the effectiveness ofDNS.
2. What policy measures are relevant in fully addressing the issues of SD in terms of the provision of resources for development finance?
1. What is the role of SD concept in protecting the environment and reduction of poverty in the short-run and in the long run?
5. How is project appraisal methodology for development-oriented projects different from that of other investment appraisal?
4. What is the role of missing markets when SCBA is applied to project appraisal involving reduction of poverty?
3. Examine the role of transaction costs in the CBA of a credit lending scheme catered to:a) exclusively for the poor; andb) for all eligible borrowers based on credit worthiness.
2. Explain the rationale behind each of the following:a) hyperbolic discounting;b) discounting with endogenous preference changes; andc) constant exponential discounting.
1. What are the two basic differences in commensurability of objectives, and what roles do these play in CBA?
5. What are the main elements of the HIPC and where might be its potential contribution to the alleviation of debt problems in some of the countries?
4. It has been observed in some studies that aid has a positive impact on growth in countries with an institutionalized check on governmental power. Is it feasible that this conclusion, if valid, readily extends to debt also as in the case of aid? Explain the reasoning for the answer.
3. The role of political factors is at least as important as economic factors in country-specific debt management, especially debt forgiveness. Explain the role of incentives and information at donor and recipient levels in reducing debt burden.
2. Examine the validity of the following claim in an ideal world (Bulow and Rogoff, 1989): "ifloans are perfectly indexed to all possible shocks then one need never observe rescheduling negotiations".
1. If the price of credit in bank lending to international entities is enhanced to reflect potential risks in debt repayment, examine the credit market efficiency implication in terms of the roles of asymmetric information, costs of contract enforcement, moral hazard, adverse selection and credit
4. SpecifY both normative as well as positive considerations in the provision of external aid. What policy and implementation reforms are relevant for the efficient aid packages?
3. Discuss the validity or limitations of the following conclusion regarding"lesson learned" in external aid projects, summarized by Krueger (1986, p.74), "Because individual projects earn their returns in a milieu influenced by overall economic policy, project fmancing is not likely to maximize
2. Examine the scope and implications of moral hazard dimension of recipient country behavior when the two-gap model constitutes the basis for extending external aid.
1. IdentifY the elements and the role of transaction costs in the effectiveness of external aid in contributing towarda) economic growth, and b)economic development in the recipient country.
6. Suggest relevant ingredients and their quantification for arriving at a financial liberalization index.
5. What are the implications, in terms of lending and borrowing policies(and their contracts as well as conditionalities, ex ante and/or ex post) of the following recommendation of the Monterrey Consensus:"Debtors and creditors must share the responsibility for preventing and resolving
4. Examine the validity, if any, of the following statement made by the then First Managing Deputy Director Stanley Fischer (statement on October 1, 1998 regarding the need for the IMF conditionality, at the World Economic Development Council, Washington DC; details obtained from the IMF website
3. Is the role of the World Bank funding and conditionality to induce private capital flows, and if yes, what measures ensure their sustainability?
2. The reforms included in the 'Washington Consensus' were claimed(Williamson, 2000) as necessary but not sufficient for promoting development. Examine the validity of this statement.
1. Does financial liberalization lead to banking crises? Is this the same as stating that banking crises are often preceded by financial liberalization?Discuss the differences in these two positions and examine relevant case studies.
5. What are the main characteristics of a 'successful' group-based microcredit scheme? Interpret these in terms of the approaches of the economics of TC.
4. If there is an inverse ranking of borrowing and repayment hierarchies in the credit markets of the formal and informal sectors, what factors can bring about a closer similarity between the two sources of credit supply?
3. Explain the role of TC in the loan recovery system as it pertains to formal financial institutions and provide the TC rationale for group-based lending.
2. If voluntary and involuntary choices of loan repayment need to be distinguished in relation to the role of economic shocks to borrower's economic entities, what arguments support the joint liability provisions of group lending in the GBB model?
1. If the private moneylender is in a position to extract the first claim from the income generated by the borrower's activities (as is often the case), is it correct to conclude that any preexisting or concurrent institutional credit tends to enhance the expected returns from loan portfolios of
8. What is the positive role of macroeconomic openness in promoting economic growth? What are the main limitations of extending openness beyond critical threshold limits? What are the economic and institutional factors that determine these limits?
7. What specific functions of the government contribute to enhancing the efficacy ofFI?
6. How do FI contribute to:a) enhance TFP; and,b) reduce TC?
5. Why is an endogenous growth theory explanation of economic growth relevant in linking FD and economic growth?
4.a) Elucidate the externality problems of capital flows.b) What prudent measures are useful for minimizing negative externalities?Examine these measures in terms of their cost-effectiveness in the short-run and long-run, using costs that include relevant TC.
3. fmancial development and economic development.
2. Explain the concepts and their interrelationships:a) financial intermediaries and financial development;b) economic growth and economic development; and
1. What are the important prerequisites for FI in order to improve their quality, and to contribute toward economic growth?
7.a) Identify the main elements of cost in the design and enforcement of contracts. What balancing is required in the ex ante and ex post costs of a contract?b) What are the desirable characteristics of an 'efficient' financial contract?
6. If we define credit market efficiency in terms of the joint welfare maximization of profits or utilities of lenders and borrowers, specify a set of necessary features of the market that facilitate such efficiency enhancement.
5. What are the limitations of the conventional analyses of equilibrium credit rationing?
4. Examine the ingredients ofTC that are relevant in effecting FDI.
3. State the factors that contribute to credit rationing as a relevant phenomenon for the analysis of credit markets. Suggest a quantifiable measure for assessing the magnitude of credit rationing.
2. Do the accelerated capital outflows from developing countries during the 1990s represent one of the characteristics of 'integration with the global economy', or is that a price to pay for achieving the latter? If this is an element of such a cost, what potential or realized benefits justify
1. Discuss the validity or otherwise of the following suggestion: in a world with greater market transparency and efficiency, financial intermediaries may constitute endangered species.
Is it always optimal to choose the same β in the optimization problem than the value used in evaluating the portfolio performance? In other words:can it be optimal to choose theoretically sub-optimal portfolios based on transaction cost considerations that do not reflect the actual incurred costs?
Illustrate the evolution of the optimal weights from the naive portfolio to the efficient portfolio in the mean-standard deviation diagram.
Use the solution from the previous exercise to update the function compute_efficient_weight() such that you can compute optimal weights conditional on a matrix B with illiquidity measures.
Consider the portfolio choice problem for transaction-cost adjusted certainty equivalent maximization with risk aversion parameter γω∗t+1 = arg maxω∈RN ,ι′ω=1ω′µ − νt(ω, β) −γ2ω′Σωwhere Σ and µ are (estimators of) the variance-covariance matrix of the returns and the
We argue that an investor with a quadratic utility function with certainty equivalent max wCE(w) = ω′µ −γ2ω′Σω s.t. ι′ω = 1 faces an equivalent optimization problem to a framework, where portfolio weights are chosen with the aim to minimize volatility given a prespecified level or
By formulating the portfolio problem as a statistical estimation problem, you can easily obtain standard errors for the coefficients of the weight function. Brandt et al. (2009) provide the relevant derivations in their paper in Equation (10). Implement a small function that computes standard
Does the portfolio performance resemble a realistic out-of-sample backtesting procedure? Verify the robustness of the results by first estimatingˆθ based on past data only. Then, use more recent periods to evaluate the actual portfolio performance.
Tweak the function optimal_theta() such that you can impose additional performance constraints in order to determine ˆθ, which maximizes expected utility under the constraint that the market beta is below 1.
The code above is very flexible in the sense that you can easily add new firm characteristics. Construct a new characteristic of your choice and evaluate the corresponding coefficient ˆθi.
How do the estimated parameters ˆθ and the portfolio performance change if your objective is to maximize the Sharpe ratio instead of the hypothetical expected utility?
Compile the object from the previous exercise. It is important that you specify a loss function. Illustrate the difference in predictive accuracy for different architecture choices.
Use keras to initialize a sequential neural network that can take the predictors from the training data set as input, contains at least one hidden layer, and generates continuous predictions. This sounds harder than it is:see a simple regression example here.2 How many parameters does the neural
Make use of a training and a test set to choose the optimal depth (number of sample splits) of the tree.
Use the package rpart to grow a tree based on the training data and use the illustration tools in rpart to understand which characteristics the tree deems relevant for option pricing
Create a function that creates predictions for a new matrix of predictors newX based on the estimated regression tree.
Write a function that takes y and a matrix of predictors X as inputs and returns a characterization of the relevant parameters of a regression tree with 1 branch.
After you understand what Ridge and Lasso regressions are doing, familiarize yourself with the glmnet() package’s documentation. It is a thoroughly tested and well-established package that provides efficient code to compute the penalized regression coefficients for Ridge and Lasso and for

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Tidy Finance With R 1st Edition Christoph Scheuch, Stefan Voigt, Patrick Weiss - Solutions

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