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NEW QUESTION: 1
George Armor, CFA, is a new stock analyst for Pedad Investments. One tool that Pedad uses to compare stock valuations is the dividend discount model (DOM). In particular, the firm evaluates stocks in terms of
"justified" multiples of sales and book value. These multiples are based on algebraic manipulation of the DDM. Over time, these multiples seem to provide a good check on the market valuation of a stock relative to the company's fundamentals. Any stock which is currently priced below its value based on a justified multiple of sales or book value is considered attractive for purchase by Pedad portfolio managers. Exhibit 1 contains financial information from the year just ended for three stable companies in the meat-packing industry: Able Corp, Baker, Inc., and Charles Company, from which Armor will derive his valuation estimates.

One of Pedad's other equity analysts, Marie Swift, CFA, recently held a meeting with Armor to discuss a relatively new model the firm is implementing to determine the P/E ratios of companies that Pedad researches. Swift explains that the model utilizes a cross-sectional regression using the previous year-end data of a group of comparable companies' P/E ratios against their dividend payout ratios (r), sustainable growth rates (g), and returns on equity (ROE). The resulting regression equation is used to determine a predicted P/E ratio for the subject company using the subject company's most recent year-end data. Swift has developed the following model, which has an R-squared of 81%, for the meat packing industry (16 companies):
Predicted P/E = 2.74 + 8.21(r) + 14.21(g) + 2.81(ROE)
(STD error) (2.11) (6.52) (9.24) (2.10)
After Swift presents the model to Armor, she points out that models of this nature are subject to limitations.
In particular, multicollinearity, which appears to be present in the meat packing industry model, can create great difficulty in interpreting the effects of the individual coefficients of the model. Swift continues by stating that in spite of this limitation, models of this nature generally have known and significant predictive power across different time periods although not across different stocks.
Armor has been asked to identify the relative valuation merits of the three stocks. Which of the following statements is correct?
A. Charles Company is the best investment because the stock is priced below book value.
B. Able Corp's earnings should grow the fastest due to its high ROE and retention ratio.
C. Able Corp is the best investment because it has the highest ROE.
Answer: B
Explanation:
Explanation/Reference:
Explanation:
A high ROE does not make a company a good investment, nor does a high book value. However, Able Corp does have the highest potential growth rate. Because the justified values for Charles Company are near the market price, there does not appear to be any problem with the valuation inputs (e.g., required return). The similarity between the justified P/B value and market price of Charles indicates that it is fairly priced and not an especially attractive investment. (Study Session 12, LOS 42.k)

NEW QUESTION: 2
A manager in an organization plans to implement a three-tier employment model and wants to ensure that the same
attributes are applied to each person in the organization.
Which approach would you recommend to meet this requirement?
A. Do not set the values in employment terms and allow override at assignment level.
B. Do not set the values in employment terms and prevent override at assignment level.
C. Set the values in employment terms and prevent override at assignment level.
D. Set the values in employment terms and allow override at assignment level.
Answer: C

NEW QUESTION: 3
Which of the following controls does a mantrap BEST represent?
A. Corrective
B. Detective
C. Deterrent
D. Physical
Answer: D

NEW QUESTION: 4
Background
Corporate Information
Fabrikam, Inc. is a retailer that sells electronics products on the Internet. The company has a
headquarters site and one satellite sales office. You have been hired as the database administrator, and
the company wants you to change the architecture of the Fabrikam ecommerce site to optimize
performance and reduce downtime while keeping capital expenditures to a minimum. To help with the
solution, Fabrikam has decided to use cloud resources as well as on-premise servers.
Physical Locations
All of the corporate executives, product managers, and support staff are stationed at the headquarters
office. Half of the sales force works at this location. There is also a satellite sales office. The other half of
the sales force works at the satellite office in order to have sales people closer to clients in that area. Only
sales people work at the satellite location.
Problem Statement
To be successful, Fabrikam needs a website that is fast and has a high degree of system uptime. The
current system operates on a single server and the company is not happy with the single point of failure
this presents. The current nightly backups have been failing due to insufficient space on the available
drives and manual drive cleanup often needing to happen to get past the errors. Additional space will not
be made available for backups on the HQ or satellite servers. During your investigation, you discover that
the sales force reports are causing significant contention.
Configuration
Windows Logins
The network administrators have set up Windows groups to make it easier to manage security. Users may
belong to more than one group depending on their role. The groups have been set up as shown in the
following table:

Server Configuration The IT department has configured two physical servers with Microsoft Windows
Server 2012 R2 and SQL Server 2014 Enterprise Edition and one Windows Azure Server. There are two
tiers of storage available for use by database files only a fast tier and a slower tier. Currently the data and
log files are stored on the fast tier of storage only. If a possible use case exists, management would like to
utilize the slower tier storage for data files. The servers are configured as shown in the following table:

Database
Currently all information is stored in a single database called ProdDB, created with the following script:

The Product table is in the Production schema owned by the ProductionStaff Windows group. It is the
main table in the system so access to information in the Product table should be as fast as possible. The
columns in the Product table are defined as shown in the following table:

The SalesOrderDetail table holds the details about each sale. It is in the Sales schema owned by the
SalesStaff Windows group. This table is constantly being updated, inserted into, and read. The columns in
the SalesOrderDetail table are defined as shown in the following table:

Database Issues
The current database does not perform well. Additionally, a recent disk problem caused the system to go
down, resulting in lost sales revenue. In reviewing the current system, you found that there are no
automated maintenance procedures. The database is severely fragmented, and everyone has read and
write access.
Requirements
Database
The database should be configured to maximize uptime and to ensure that very little data is lost in the
event of a server failure. To help with performance, the database needs to be modified so that it can
support in-memory data, specifically for the Product table, which the CIO has indicated should be a
memoryoptimized table. The auto-update statistics option is set off on this database. Only product
managers are allowed to add products or to make changes to the name, description, price, cost, and
supplier. The changes are made in an internal database and pushed to the Product table in ProdDB
during system maintenance time. Product managers and others working at the headquarters location also
should be able to generate reports that include supplier and cost information.
Customer data access
Customers access the company's website to order products, so they must be able to read product
information such asname, description, and price from the Product table. When customers place orders,
stored procedures calledby the website update product quantityon-hand values. This means the product
table is constantly updated at randomtimes.
Customer support data access
Customer support representatives need to be able to view and not update or change product information.
Management does not want the customer support representatives to be able to see the product cost or any
supplier information.
Sales force data access
Sales people at both the headquarters office and the satellite office must generate reports that read from
the Product and SalesOrderDetail tables. No updates or inserts are ever made by sales people. These
reports are run at random times and there can be no reporting downtime to refresh the data set except
during the monthly maintenance window. The reports that run from the satellite office are process intensive
queries with large data sets. Regardless of which office runs a sales force report, the SalesOrderDetail
table should only return valid, committed order data; any orders not yet committed should be ignored.
Historical Data
The system should keep historical information about customers who access the site so that sales people
can see how frequently customers log in and how long they stay on the site.
The information should be stored in a table called Customer Access. Supporting this requirement should
have minimal impact on production website performance.
Backups
The recovery strategy for Fabrikam needs to include the ability to do point in time restores and minimize
the risk of data loss by performing transaction log backups every 15 minutes.
Database Maintenance
The company has defined a maintenance window every month when the server can be unavailable. Any
maintenance functions that require exclusive access should be accomplished during that window.
Project milestones completed
Revoked all existing read and write access to the database, leaving the schema ownership in place.

Configured an Azure storage container secured with the storage account name MyStorageAccount with

the primary access key StorageAccountKey on the cloud file server.
SQL Server 2014 has been configured on the satellite server and is ready for use.

On each database server, the fast storage has been assigned to drive letter F:, and the slow storage

has been assigned to drive letter D:.
You need to change the ProdDB database.
Which two database options should you change to meet the requirements? Each correct answer presents
part of the solution. (Choose two.)
A. CONTAINS FILESTREAM
B. Change recovery model to FULL
C. CONTAINS MEMORY OPTIMIZED DATA
D. CONTAINMENT = PARTIAL
E. COLLATE IN.MEMORY
F. Change recovery model to BULK_LOGGED
Answer: C,E
Explanation:
Explanation/Reference:
Explanation:
Scenario: To help with performance, the database needs to be modified so that it can support in-memory
data, specifically for the Product table, which the CIO has indicated should be a memory-optimized table.
Collations and Code Pages FileGroupDefinition.ContainsMemoryOptimizedData Property
(Microsoft.SqlServer.TransactSql.ScriptDom)