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The valid response is 3-synergistic with acquisition,2-acceptable,1-no effect or unknown, or 0-unacceptable. Please choose 3,2,1, or 0.1How would you rate the target firm's tax planning?The valid choice is 3-synergistic with acquisition),2-acceptable,1-no effect or unknown, or 0-unacceptable. Please choose 3,2,1, or 0.1How would you qualitatively characterize the target firm'sgrowth or expansion policy in relation to its resources?The valid response is 4-mismatched,1-na or unknown,or 0- well-matched. Please choose 4,1, or 0 and one answer only.1How does the target firm's management feel about the acquisition?Factors to consider include golden parachute, continued employment, etc.The valid response is 3-cooperative with acquisition,2-compatible,1-no effect or unknown, or 0-antagonistic. Choose 3,2,1, or 0.3The third phase of questions gathers the target firm's financialinformation in assessing its suitability for acquisition.In all your responses, please choose only one answer for each questionand remember that the answer is case-sensitive and should be in exactnumber or word as it appears in the choice.What is the size, total assets, of the target firm?The valid choice is 6-under $100 million,3-between $100 million and $500 million, 0-over $5million.Please choose 6,3, or 0 and one answer only.3What is the target firm's market to book value ratio?Please enter any number or na if the ratio is unknown.Your response will be converted by the system as 3,2,1, or 0.Please enter a valid response, for no error checking will be done.0.9How has the target firm's market to book value ratio changed comparedto one year ago?The valid response is 5-greater than or equal to 50% decrease,3-decreased but less than 50%,1-the ratio is unknown, or 0-increased.Please choose 5, 3, 1, or 0 and only one answer.3What is the target firm's price to earnings ratio?Please enter na if the ratio is unknown.Please enter a valid response, for no error checking will be done.Your response will be converted by the system as 3,2,1, or 0.1.2How has the target firm's price to earnings ratio changed comparedto one year ago?The valid response is 5-greater than or equal to 50% decrease,3-decreased but less than 50%,1-the ratio is unknown, or 0-increased.Please choose 5, 3, 1, or 0 and only one answer.1What is the average excess return of the target firm for the last21 trading days?The valid response is 3-less than or equal to $-3 per share,2-greater than $-3 and less than $-0.2 per share, 1-between $-0.2 and $0.2 per share or unknown, or 0-greater than $0.2 per share.Please choose 3, 2, 1, or 0 and one answer only.2How has the target firm's average excess return for the last 21trading days changed compared to one year ago?The valid response is 4-greater than or equal to 50% decrease,3-less than 50% decrease, 1-immaterial or unknown, or 0-increased.Please choose 4, 3, 1, or 0 and one answer only.3How much has the trading volume for the last 21 trading days increasedfor the target firm compared to three month ago?The valid response is 3-more than 300%, 2-between 300% and 100%,1-less than 100% and greater than 0%, or 0-not increased or unknown.Please choose 3, 2, 1, or 0 and one answer only.1How much has the bid-ask spread for the last 21 trading days increasedfor the target firm compared to three month ago?The valid choice is 3-more than 200%, 2-between 200% and 100%,1-less than 100% and greater than 0%, or 0-not increased or unknown.Please choose 3, 2, 1, or 0 and one answer only.2What is the current ratio of the target firm? Enter na if unknown.Current ratio is the ratio of current assets to current liabilities.This response will not be used for evaluation, but please answer for future neural nets application.0.9How would you evaluate the current ratio of the target firm for acquisition purpose?The valid response is 6-excellent, 3-good, 1-unknown,or 0-unacceptable. Choose 6, 3, 1, or 0 and one answer only.1What is the quick ratio of the target firm? Enter na if unknown.Quick ratio is the ratio of current assets minus inventorydivided by current liabilities.This response will not be used for evaluation, but please answer.0.8How would you evaluate the quick ratio of the target firm for acquisition purpose?The valid response is 4-excellent, 3-good, 1-unknown,or 0-unacceptable. Choose 4, 3, 1, or 0 and one answer only.1What is the return on total assets of the target firm?Enter na if the ratio is unknown.The return on total assets is the ratio of net income to total assets.This response will not be used for evaluation, but please answer.naHow would you evaluate the return on total assets of the target firm for acquisition purpose?The valid response is 5-excellent, 3-good, 1-unknown,or 0-unacceptable. Please choose 5,3,1,or 0 and one answer only.1What is the target firm's return on equity? Enter na if unknown.The return on equity is the ratio of net income to total equity.This response will not be used for evaluation, but please answer.0.7How would you evaluate the target firm's return on equity for acquisition purpose?The valid response is 5-excellent, 3-good, 1-unknown,or 0-unacceptable. Please choose 5,3,1, or 0 and only one answer.1You have successfully answered all the questions required for theexpert system to return a target firm's acquisition suitability value.This phase contains environmental evaluation of the user's input for acquisition consideration. It returns one overall evaluation of environmental input and offers an explanation for the evaluation. The possible values for the evaluation are excellent, good, fair, or poor. Each of the 3 groups ofuser input will be assessed by the expert system and will begiven one of the four values. Based on the 64 combinationof evaluation values (4 values for each group and 3 groups = 4x4x4=64), a final overall evaluation will be presented bythe expert system as explained earlier using 10 point scale.Based on your input to environmental factors questions,the overall environmental factors score for acquisitionpurpose is evaluated to be fair.The actual score of environmental questions is 19. The environmental factors score is evaluated as follows:excellent 27-25good 24-20fair 19-12poor 11-0.Would you like to see a detailed report of your responseto 8 environmental factors questions?yes or no? Please enter yes or no.yesYour responses to environmental factor questionsare as follows. The response is shown exactly as youentered along with possible answer choices. product life cycle? 0 among 0 1 2 3. competition? 2 among 0 1 2 3. labor market? 2 among 0 1 2 3 4. acquisition occurred? 3 among 0 1 3. technology disturbance? 2 among 0 1 2 3. regulatory change? 2 among 0 1 2 3. line of business synergy? 4 among 0 1 4. economies of scale? 4 among 0 1 4.THE FOLLOWING IS AN OVERALL MANAGERIAL FACTORS EVALUATION.This phase contains managerial evaluation of the user's input for acquisition consideration. It returns one overall evaluation of managerial input and offers an explanation for the evaluation. The possible values for the evaluation are excellent, good, fair, or poor. Each of the 3 groups ofuser input will be assessed by the expert system and will begiven one of the four values. Based on the 64 combinationof evaluation values (4 values for each group and 3 groups = 4x4x4=64), a final overall evaluation will be presented bythe expert system as explained earlier using 10 point scale.Based on your input to managerial factors questions,the overall managerial factors score for acquisitionpurpose is evaluated to be fair.The actual score of managerial questions is 18. The managerial factors score is evaluated as follows:excellent 39-35good 34-28fair 27-15poor 14-0.Would you like to see a detailed report of your responseto 12 managerial factors questions?yes or no? Please enter yes or no.noTHE FOLLOWING IS AN OVERALL FINANCIAL FACTORS EVALUATION.This phase contains financial evaluation of the user's input for acquisition consideration. It returns one overall evaluation of financial input and offers an explanation for the evaluation. The possible values for the evaluation are excellent, good, fair, or poor. Each of the 3 groups ofuser input will be assessed by the expert system and will begiven one of the four values. Based on the 64 combinationof evaluation values (4 values for each group and 3 groups = 4x4x4=64), a final overall evaluation will be presented bythe expert system as explained earlier using 10 point scale.Based on your input to financial factors questions,the overall financial factors score for acquisitionpurpose is evaluated to be fair.The actual score of financial factors questions is 21. The financial factors score is evaluated as follows:excellent 55-50good 49-35fair 34-19poor 18-0.Would you like to see a detailed report of your responseto 13 financial factors questions?yes or no? Please enter yes or no.yesYour responses to financial factor questionsare as follows. The response is shown exactly as youentered along with possible answer choices. size, total assets? 3 among 0 3 6. market to book value? 0 among 0 1 2 3. market to book value trend? 3 among 0 1 3 5. price to earnings ratio? 2 among 0 1 2 3. price to earnings ratio trend? 1 among 0 1 3 5. average excess return(absolute)? 2 among 0 1 2 3. average excess return trend? 3 among 0 1 3 4. trading volume trend? 1 among 0 1 2 3. bid-ask spread trend? 2 among 0 1 2 3. current ratio? 1 among 0 1 3 6. quick ratio? 1 among 0 1 3 4. return on total assets? 1 among 0 1 3 5. return on equity? 1 among 0 1 3 5.The expert system will now return an overall acquisitionsuitability value of the target firm on a 10 pointscale from -2 to 7 (best) after the following 2 questions.What is the user's (your) name?Wallstreet PracticeWhat is the name of the target firm?Notdoing SogoodThis last phase of this expert system returns one overall valueof suitability of the target firm for acquisition based on alluser inputs. Each of the user's response belongs to one of threefactor groups, environmental, managerial, and financial. In ordercircumvent having to write close to 10,000 rules and to summarizethe responses in a more manageable chunk of information, onlythe overall values of each of three factor groups were evaluatedfor final overall recommendation based on 10 point scale asdecribed before. Those 10 point scale are repeated as follows;-2(not suitable at all), -1(feasible but not acceptable),0(indifferent), 1(feasible but not so attractive),2(weakly attractive), 3(can be a good target), 4(good target),5(very good target), 6(excellent target), 7(a dream target).Based on input from the user (Wallstreet Practice),the target firm's (Notdoing Sogood) acquisition suitability isevaluated by this expert system as 3 on 10 point scale from -2 to 7 (best).Would you like to see a detailed explanationof the point scale again?yes or no? Please enter yes or no.yes-2(not suitable at all), -1(feasible but not acceptable),0(indifferent), 1(feasible but not so attractive),2(weakly attractive), 3(can be a good target), 4(good target),5(very good target), 6(excellent target), 7(a dream target).You (Wallstreet Practice) have successfully completedthe evaluation of acquisition suitability of the target firm (Notdoing Sogood).Do you wish to evaluate another target firm?The valid choice is yes or no.noYou have chosen to end the acquisition suitability evaluation.Have a nice day.CLIPS> (exit)
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