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Imagine that you have $100,000 to invest. You are going to invest it all in one investment for the next 5 years, at least, at which point you will reevaluate both your investment and personal situations.

You will invest it all in one of the following investments – these are your only 2 options:

A) bank account earning 5% per year.
B) Common stock of Apple

You will be performing the analysis from the perspective of an investor who is 25 years from retirement and the investor’s income is greater than living expenses. The investor has a liquid net worth of $1,000,000 of which 40% is invested in the S&P 500 index, 40% in a medium-duration, high quality bond fund and 20% in a savings account earning 5% interest per year. You are to determine if the investor should take $100,000 from the savings account and
purchase $100,000 of this company’s common stock.

Where are you going to invest your $100,000? Why?

Your recommendation should comprehensively but succinctly provide sufficient information for the investor to approve your recommendation by being able to address the investor’s reasonable questions including the following:

What is your objective? What is the problem? What are you trying to figure out?

What historical financial information helped you make your decision – ratios, growth rates, margins, projections, competition?

What role does risk play and how do you account for it in your analysis?

What industry information helped you make your decision – such as competition, overall markets, and state of the economy?

What are you assuming about the future?

What are the critical factors that led you to choose the option you chose?

What decision analysis tools helped you to make your decision?

Please limit your response to 3 pages, typed, double-spaced, plus no more than 2 pages of exhibits. This is both a math and a story assignment: your math has to support your story and your story has to support your math. 3 pages of text plus 2 pages of exhibits is not a lot to cover this assignment; you need to be concise, relevant, and convincing in those 5 pages.

There is no right answer. But there are right approaches, wrong answers and wrong approaches. You will be graded on the quality of your approach, the accuracy of your analysis, and how convincing your argument is.

Sample Solution

A bad interpretation of history is related to denialism. Denialism is the act of rejecting the truth in the face of proof or strong and valid evidence that exists. It can be mainly made by replicating history records or documents. According to Richard J. Evans, this action will create a sense of doubt in the genuine record and thus create a false interpretation of the event. This can be seen in Holocaust denial. It is a strategy intended to discredit or put doubt on the Holocaust’s historical facts. Deniers engage in this behavior to diminish public sympathy for Jews, undermine the legitimacy of the State of Israel, sow doubt about Jews and the Holocaust, and attract attention to certain topics or points of view. However upon the discovery of Anne Frank’s diary, one of the victims of the Holocaust, the scholars had rejected the denial and the British court judged David Irving, a Holocaust denier to be a “historical falsifier, anti-Semitic, and racist who was linked with right-wing radicals who supported neo-Nazism”. Other than that, history interpretation is also influenced by political power. This can be seen in 2007 when Shinzo Abe, the prime minister of Japan at that time stated that there is no strong evidence to prove that sexual slavery was coercion by the Japanese military during the second Sino-Japanese war. Due to this statement, it influenced few people to interpret that the incident never took place, and even some radical groups interpreted the death toll as purely military and that no such crimes were ever committed. This shows how much power politics have in history interpretation among historians and the public. Even so, as a knower, we can differentiate these false interpretations by referring back to the latest evidence that is available and the scholars’ reasoning regarding the history.

In conclusion, we can say that to distinguish between good and bad interpretation is the closeness of it to the truth or reality. Interpretation is a process of triggering the meaning of a certain matter, therefore when the process is being disturbed by certain matters such as exaggeration and denialism, the interpretation being made is still considered as a bad interpretation even though it is the closest to the truth. In both art and history, logical explanation and evidence are required to create a good interpretation. However, this does not limit the use of imagination when interpreting art or historical sources.

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