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Lapatulllka [165]
4 years ago
8

The economy is in the horizontal portion of the AS curve, investment spending is interest insensitive and there is no liquidity

trap. According to the Keynesian transmission mechanism, if the money supply increases the interest rate will __________, investment spending will __________, the AD curve will __________, and Real GDP will __________.
Business
1 answer:
kaheart [24]4 years ago
3 0

Answer: does not change, does not change, does not change, does not change.

Explanation: Keynesian transmission mechanism traditional state that, changes in money supply affect aggregate demand through changes in interest rate or exchange rate.

If the money supply increases the interest rate will "does not change", investment spending will "not change ", and the AD curve "not change", and the real GDP will "not change".

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You have been asked to create a synthetic short position in a forward contract that permits you to sell 10 units of the underlyi
Zanzabum

Solution :

\text{Short forward  =  buy a put +  short a call on the same stock} with the same exercise price.

X = exercise price = 50

1). Position to be taken :

-- buy 10 numbers of Put options with strike price of $ 50 per unit.

--- short (sell) 10 numbers of Call option with strike price of $ 50 per unit.

2). Cost of synthetic short position = $10 \times (P-C)$,

where, P = price of 1 put ption

           C = price of 1 call option

The Call - Put parity equation :

$\frac{C+X}{(1+r)^t}=S_0+P$

Here, C = Call premium

          X = strike price of call and Put

          r = annual rate of interest

           t = time in years

          $S_0$ = initial price of underlying

          P = Put premium

Therefore,

$P-C=PV(X)-S_0=\frac{X}{(1+r)^t}-S_0$

Here, t = 1, S_0 = 48, X = 50

So the cost of the position is given as : $\frac{50}{(1+r)} -48$

7 0
3 years ago
2. Think of a real or made up but realistic example of a speculative risk that you or someone you know may face, and then answer
Advocard [28]

Answer:

See explanation section

Explanation:

a) Implementing an urban planning project is an example of speculative risk. There is a huge uncertainty before implementing a project as well as after its implementation regarding its gross outcomes. Projects of any type can completely fail. But there are some cases that they succeed; they may spawn some positive outcomes for a specific community. In any project, there is always a probability of both gain and loss.

b) There are a lot of possible adverse outcomes of this type of risk. Maybe the project is not running sustainably. The ground condition may not be suitable afterward, but inclement weather can reduce the desired project utilitarian. It can attribute an adverse impact on the present environment. Assume that the budget cross before the implementation of that project. Finally, these sorts of adverse outcomes may result in the project’s failure.

c) Project risk can also beget some positive outcomes. In this type of threat, after implementation of that project, it may run sustainably. The ground and atmospheric conditions may appear suitable for this specific project. The approved budget may consider sufficient for the project implementation. That is how; these sorts of positive outcomes may result in the project’s success.

d) These types of risks, both positive and negative, may create unexpected expenses. If we think about the real risks, to manage these risks, we should exploit, share and enhance the specific risk, And in case of managing the harmful risks, we should transfer into a better resource-based project or try to mitigate the negative impacts of the project. Both of these efforts can be considered as unexpected expenses.

e) To protect myself against the real risks, I’ll exploit the specific risk. Because operating the risk is about increasing the chances of positive effects, the risk may have on the project. But if it is about the detrimental risks, I’ll try to avoid the risks by doing some activities like delegating tasks, changing the deadline, and increasing the human resources of the project team.

5 0
3 years ago
Henson company applies overhead on the basis of 120% of direct labor cost. job no. 190 is increased with $140,000 of direct mate
DaniilM [7]
The total manufacturing costs for the Job No. 190 is 470,000. To get its direct labor cost, which is the basis of the Henson Company in applying its overhead at the rate of 120%, we need to divide the manufacturing overhead of $180,000 by the rate 120% to get the direct labor cost of 150,000. (180,000/210% = 150,000). To get the total manufacturing cost, you need to add the:direct materials- 140,000direct labor- 150,000manufacturing overhead- 180TOTAL= 470,000- this is the total manufacturing costs (Job No. 190)
8 0
4 years ago
The executives for New Haus LLC set the retail objective for the company. These objectives are broken down in order to create th
yaroslaw [1]

Answer:

Top-down planning

Explanation:

Top-down planning  -

It refers to the method planning , where the goals are bifurcated and placed according to the hierarchy from top to bottom , is referred to as top - down planning .

As breaking and arranging the goals , make the process to accomplish the goals in a better manner .

The process require the movement from higher level to lower level , in a very orderly manner to hasten the process .

Hence , from the given scenario of the question ,

The correct answer is Top-down planning .

4 0
3 years ago
When Jim Poss bought used kitchen trash compactors to tinker with and then tried some reverse engineering to test the feasibilit
Aleonysh [2.5K]

Answer:

The correct answer is a.

Explanation:

Innovators are characterized by continuously trying out new experiences and implementing ideas that do not exist. They tend to visit new places, try new things, seek new information and experiment to learn new things. In these ways, they can broaden the diversity of their knowledge and increase their ability to innovate.

Have a nice day!

8 0
3 years ago
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