The question is not complete, last part of the question is missing which I write below;
Which of the following principles of economic interaction best describes this scenario?
And the answer is "trade can make everyone better off
".
Trade can make everyone better off in light of the fact that it enables nations or companies to work in what they excel at and to appreciate a more extensive assortment of products and ventures.
The three principles concerning economic interactions are:
(1) Trade can make everyone better off;
(2) Markets are generally a better way to arrange economic activity
(3) Governments can at times develop market outcomes.
Answer:
The required rate of return on stock is 14.6% and option b is the correct answer.
Explanation:
The required rate of return is the minimum return that investors demand/expect on a stock based on the systematic risk of the stock as given by the beta. The expected or required rate of return on a stock can be calculated using the CAPM equation.
The equation is,
r = rRF + Beta * (rM - rRF)
Where,
- rRF is the risk free rate
- rM is the return on market
r = 0.05 + 1.2 * (0.13 - 0.05)
r = 0.146 or 14.6%
The investor will show a capital loss of $155.
We gather the following information from this question:
Pop of the fund three years ago : $12
NAV of the fund three years ago : $11.50
Current Pop : $11
Current NAV : $10.45
Number of shares : 100 shares.
We need to calculate capital loss or gain on the 100 shares in the mutual fund.
While taking the cost per unit, <u>we need to consider the public-offer-price (pop) into consideration, since an investor can only buy the shares at pop</u>.
Similarly, while selling the shares, the <u>shareholder can liquidate his position by selling back to the mutual fund at the NAV prevailing at the end of the business day</u> on which he wants to sell.
So, the formula to calculate capital gain or loss is:
Answer:
The growth of the real GDP per capita was 7.18%
Explanation:
It is important to establish that:
Future Value = Present Value × ((1 + r)^t), given that <em>r</em> is the <em>interest rate</em> and <em>t</em> is the <em>time period</em>
Real GDP per worker increased from $40,000 to $320,000 in 30 years
Therefore, we have;
320000 = 40000*(1+r)^30
(1 + r)^30 = 8
1 + r = 8^1/30
1 + r = 1.0718
r = 0.0718 = 7.18%
Answer:
The answer is: E) workers in Alzania have higher productivity due to better education and training.
Explanation:
Alzania and its neighbor both produce cotton and they both have the same amount of workers in the production of cotton. If Alzania is able to produce more cotton (or any type of product) using the same amount of resources (in this case labor) than its neighbor, we can conclude that Alzania does have an absolute advantage in that industry.
This absolute advantage exists because Alzania's workers are more productive than their neighbor's workers.
For example, lets say both countries have 5,000 cotton workers. Alzania produces 100 tons of cotton per worker, while its neighbor only produces 80 tons of cotton per worker. That means Alzania's workers are more productive, and labor usually gains productivity through education or training.
