(ii) evaluates the relative performance of the four depots as indicated by the analysis in the summary table
prepared in (i); (5 marks)
(ii) Briefly explain the extent to which the application of sensitivity analysis might be useful in deciding
which refrigeration system to purchase and discuss the limitations inherent in its use. (3 marks)
The cost-volume-profit (C-V-P) analysis can be used in making decisions about ______ and so on.
A.selling prices
B.production volume
C.levels of discretionary fixed costs
D.all the three above
(b) Explain how the use of SWOT analysis may be of assistance to the management of Diverse Holdings Plc.
(3 marks)
How are the forward transactions made in the forward market?
A.When the dealers see marginal differences in the rate of exchange in different markets, they can buy the second currency in one market and selling in another.
B.Most of the dealing in the foreign exchange market is to satisfy the immediate requirements of traders.
C.The dealers can close a deal by agreeing the rate of exchange in the meantime in this market and then delivery of currency is specified to take place at a future date.
D.The markets respond to the normal laws of supply and demand of currency.
A.Fundamental analysis
B.Operational efficiency
C.Technical analysis
D.Semi-strong form efficiency
(b) Ratio analysis in general can be useful in comparing the performance of two companies, but it has its limitations.
Required:
State and briefly explain three factors which can cause accounting ratios to be misleading when used for
such comparison. (6 marks)