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3 years ago

How do exports and imports affect a nation's economy?

1 answer:

6 0

We import goods from other countries when they are harder to make in ours, we export goods to other countries when the goods are harder to make or obtain in theirs. if a nation exports more than it imports, a surplus is created. When a country imports goods more than it exports, it creates a trade deficit. A trade deficit in a nation causes it to have to borrow from other countries in order to pay for the imports. On the other hand, a surplus is much healthier for the economy light of the fact that it boosts economic output.

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Here are returns and standard deviations for four investments. Return (%) Standard Deviation (%) Treasury bills 4.5 0 Stock P 8.

Jlenok [28]

Answer:

a. Standard deviation of the portfolio = 7.00%

b(i) Standard deviation of the portfolio = 30.00%

b(ii) Standard deviation of the portfolio = 4.00%

b(iii) Standard deviation of the portfolio = 21.40%

Explanation:

Note: This question is not complete. The complete question is therefore provided before answering the question as follows:

Here are returns and standard deviations for four investments.

Return (%) Standard Deviation (%)

Treasury bills 4.5 0

Stock P 8.0 14

Stock Q 17.0 34

Stock R 21.5 26

Calculate the standard deviations of the following portfolios.

a. 50% in Treasury bills, 50% in stock P. (Enter your answer as a percent rounded to 2 decimal places.)

b. 50% each in Q and R, assuming the shares have:

i. perfect positive correlation

ii. perfect negative correlation

iii. no correlation

(Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.)

The explanation to the answer is now provided as follows:

a. Calculate the standard deviations of 50% in Treasury bills, 50% in stock P. (Enter your answer as a percent rounded to 2 decimal places.)

Since there is no correlation between Treasury bills and stocks, it therefore implies that the correlation coefficient between the Treasury bills and stock P is zero.

The standard deviation between the Treasury bills and stock P can be calculated by first estimating the variance of their returns using the following formula:

Portfolio return variance = (WT^2 * SDT^2) + (WP^2 * SDP^2) + (2 * WT * SDT * WP * SDP * CFtp) ......................... (1)

Where;

WT = Weight of Stock Treasury bills = 50%

WP = Weight of Stock P = 50%

SDT = Standard deviation of Treasury bills = 0

SDP = Standard deviation of stock P = 14%

CFtp = The correlation coefficient between Treasury bills and stock P = 0.45

Substituting all the values into equation (1), we have:

Portfolio return variance = (50%^2 * 0^2) + (50%^2 * 14%^2) + (2 * 50% * 0 * 50% * 14% * 0) = 0.49%

Standard deviation of the portfolio = (Portfolio return variance)^(1/2) = (0.49%)^(1/2) = (0.49)^0.5 = 7.00%

b. 50% each in Q and R

To calculated the standard deviation 50% each in Q and R, we first estimate the variance using the following formula:

Portfolio return variance = (WQ^2 * SDQ^2) + (WR^2 * SDR^2) + (2 * WQ * SDQ * WR * SDR * CFqr) ......................... (2)

Where;

WQ = Weight of Stock Q = 50%

WR = Weight of Stock R = 50%

SDQ = Standard deviation of stock Q = 34%

SDR = Standard deviation of stock R = 26%

b(i). assuming the shares have perfect positive correlation

This implies that:

CFqr = The correlation coefficient between stocks Q and = 1

Substituting all the values into equation (2), we have:

Portfolio return variance = (50%^2 * 34%^2) + (50%^2 * 26%^2) + (2 * 50% * 34% * 50% * 26% * 1) = 9.00%

Standard deviation of the portfolio = (Portfolio return variance)^(1/2) = (9.00%)^(1/2) = (9.00%)^0.5 = 30.00%

b(ii). assuming the shares have perfect negative correlation

This implies that:

CFqr = The correlation coefficient between stocks Q and = -1

Substituting all the values into equation (2), we have:

Portfolio return variance = (50%^2 * 34%^2) + (50%^2 * 26%^2) + (2 * 50% * 34% * 50% * 26% * (-1)) = 0.16%

Standard deviation of the portfolio = (Portfolio return variance)^(1/2) = (0.16%)^(1/2) = (0.16%)^0.5 = 4.00%

b(iii). assuming the shares have no correlation

This implies that:

CFqr = The correlation coefficient between stocks Q and = 0

Substituting all the values into equation (2), we have:

Portfolio return variance = (50%^2 * 34%^2) + (50%^2 * 26%^2) + (2 * 50% * 34% * 50% * 26% * 0) = 4.58%

Standard deviation of the portfolio = (Portfolio return variance)^(1/2) = (4.58%)^(1/2) = (4.58%)^0.5 = 21.40%

8 0

3 years ago

Taylor is a procurement specialist for Hillside Corporation. He is reviewing contracts, and notices a pattern between three part

aleksandr82 [10.1K]

Answer:

Explanation:

Bid rotation is when contractors collude and take turns in winning a bid. Colluding contractors submit bids but take turns being the low bidder.

Bid-tailoring is when an employee in collusion with a contractor tailors bid specifications to give an unfair advantage to a certain contractor.

Complementary bids are bids intended only to give the appearance of a genuine bid. Colluding bidders submit higher priced or deliberately defective bids to in order to ensure the selection of the designated winner at inflated prices.

Phantom bids are fake bids

7 0

3 years ago

Describe the promotional mix in a few sentences.

natulia [17]

Answer:

It's a specific combination of the tools channels and processes you use to promote your offerings it's a what you say how you say it who you say it to what channels you use to reach them and how often you communicate

7 0

2 years ago

Total revenue:

pishuonlain [190]

Answer:

remains unchanged as price increases when demand is unit elastic.

Explanation:

Total revenue = price × quantity

Demand is elastic when a small change in price has a greater effect on the quantity demanded.

If price is increased and demand is elastic, quantity demanded would fall more than the increase in price and total revenue falls.

Demand is inelastic if a small change in price has little or no effect on quantity demanded.

If price is increased and demand is inelastic, change in quantity demanded would be less than changes in price. As a result, total revenue would increase.

Demand is unit elastic if a change in price has an equal proportional effect on quantity demanded. The elasticity of demand always sums up to one.

If price is increased and demand is unit elastic, there would be no change in total revenue.

I hope my answer helps you

5 0

3 years ago

According to the census bureau, the u. S. Population is projected to grow by 78 million between 2017 and 2060. The native popula

Margarita [4]

Between 2017 and 2060, the growth in the U.S. population will be accounted for by a growth in the foreign-born population of 85%.

<h3>How will the American population change by 2060?</h3>

The census bureau believes that the U.S. population will change by more than 78 million by 2060.

Out of this number, the foreign-born population of the nation which includes immigrants and their children, will comprise of 85%.

Find out more on the U.S. population at brainly.com/question/16669950

4 0

2 years ago