Answer:
A the MP curve shift up ,there is an upward movement along the IS curve
Answer:
There is a drought and very few strawberries are available. More people want the strawberries than there are berries available. The price of strawberries increases dramatically. A huge wave of new, unskilled workers come to a city and all of the workers are willing to take jobs at low wages.
Explanation:
Hope this helps- Good Luck! ^w
Answer:
$49,252
Explanation:
Calculation to the estimated warranty liability using the expected cash flow method.
Estimated warranty liability =[($20,000 x .4)+($30,000 x .6) x 0.95238]+ [($30,000 x .7)+($20,000x .3) x 0.90703]
Estimated warranty liability =[($8,000+$18,000)×0.95238]+[($21,000+$6,000)×0.90703
Estimated warranty liability =($26,000×0.95238)+($27,000×0.90703)
Estimated warranty liability =$24,762+$24,490
Estimated warranty liability =$49,252
Therefore the estimated warranty liability using the expected cash flow method is $49,252
Answer:
The proportion of funds invested in stock A is 66.67% or 2/3 of the total investment in the portfolio.
Explanation:
The portfolio beta is the sum of the weighted average of the individual stock betas that form up the portfolio. The portfolio beta is a measure of risk of the portfolio. The formula for portfolio beta is,
Portfolio beta = wA * Beta of A + wB * Beta of B + ... + wN * Beta of N
Where w is the weight of each individual stock in the portfolio.
The beta of the market portfolio is always equal to one. Thus, taking this as portfolio beta, we can calculate the weighatge of each stock in the portfolio.
Let x be the weighatge of investment in stock A
Then (1 - x) will be the weightage of stock B.
1 = x * 0.8 + (1-x) * 1.4
1 = 0.8x + 1.4 - 1.4x
1 - 1.4 = -0.6x
-0.4 / -0.6 = x
x = 0.6667 or 66.67% or 2/3
Thus, the proportion of funds invested in stock A is 66.67%
Answer:
The price of put option is $2.51
Explanation:
The relation between the European Put option and Call option is called the Put-Call parity. Put-Call parity will be employed to solve the question
According to Put-Call parity, P = c - Sо + Ke^(-n) + D. Where P=Put Option price, C=Value of one European call option share. Sо = Underlying stock price, D=Dividend, r=risk free rate, t = maturity period
Value of one European call option share = $2
Underlying stock price = $29
Dividend = $0.50
Risk free rate = 10%
Maturity period = 6 month & 2 month, 5 month when expecting dividend
P = c - Sо + Ke^(-n) + D
P = $2 - $29 + [$30 * e^[-0.10*(6/12)] + [$0.50*e^(-0.10*(2/12) + $0.50*e^(-0.10*(5/12)]
P = $2 - $29+($30*0.951229) + ($0.50*0.983471 + $0.50*0.959189)
P = -$27 + $28.5369 + $0.4917 + $0.4796
P = $2.5082
P = $2.51
Therefore, the price of put option is $2.51
