Solution :
Given :
The stock index contracts at = $ 394.85
Index = $ 392.54
Risk fee rate = 2.83 %
Dividend = 2.08 %
Now take long position on the index at $ 392.54 per share
After 75 days, they have to pay $ 392.54 + 392.54 x 2.83 x 75/365
= $ 394.823
Take s short position on the stock index futures contract on $ 394.85 per share.
Dividends received = $ 392.54 x 2.08%
= $ 8.164
Therefore, there is an arbitrage opportunity.
Answer:
b contractionary monetary policy will be effective.
Explanation:
Inflation occurs when excess money is used to buy goods, that is price of basket of goods rises. It results from a decline in the value of money.
Central banks are tasked with control of a country's economy and rising inflation needs to be reduced.
To do so the Central Bank uses contractionary monetary policies aimed at reducing money in circulation.
The rationale is that the more scarce money is the more the demand for it, and in turn the more value it will have.
Contractionary monetary policies includes increase in interest rate to make lending more expensive, and selling of government bonds to the public in order to mop up excess cash
The answer is D Credit analysis
Answer: The net effect of additional debt on WACC is uncertain.
Explanation:
Weighted Average Cost of Capital (WACC) refers to the rate of return that a company is paying it's capital providers on average be it debt holders or shareholders.
Adding additional debt to the mix effects the WACC in an uncertain way due to the different ways the WACC could react. For example, adding additional debt decreases the after-tax cost of debt because debt is tax deductible which means that more money can flow to shareholders so that reduces the cost of equity. At the same time however, Additional debt can increase the risk of bankruptcy meaning that the before tax cost of debt rises which also increase the WACC.
The effect can swing either way thereby making it uncertain.
Meghan will look 4 a company that has respect for employees. a good vacation plan, and someone to cover her shift wen she is not there.