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vaieri [72.5K]
3 years ago
15

When economists use the term ceteris paribus, they are indicating that

Business
1 answer:
yawa3891 [41]3 years ago
3 0
Ceteris paribus mean other thing remaining the same.

so the correct answer should be B.
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A beneficiary acquired stock from a decedent. The stock's fair market value at the date of the decedent's death was $500,000. Th
Ivanshal [37]

Answer:

Beneficiary recognized gain is $510000.

Explanation:

The amount paid by the decedent for the stock = $280000

The market value of the stock at the time of death = $500000

The selling price or the amount received by the beneficiary by the sell of stock = $510000

Since the recognized gain is calculated by subtracting the amount paid by the person to buy the stock from the amount that he receives from the sale of stock. But in this case, the beneficiary pays zero for the stock but gets all the money after selling.

Beneficiary recognized gain = amount received from the sell – the amount paid by the beneficiary.

= $510000 – 0

= $510000

7 0
3 years ago
North Bank has been borrowing in the U.S. markets and lending abroad, thereby incurring foreign exchange risk. In a recent trans
Vsevolod [243]

Answer:

A) 10.82%

B) 5.27%

C) 8.56%

Explanation:

Given data :

North Bank Borrow ; $1.4 million at 5 percent

Lend in pounds at 9%

spread = ( 4% )

spot rate = 1.454

<u>A)  Determine the loan rate to maintain the 4 percent spread</u>

Expected spot rate = 1.43

First step :

Lending amount = $1.4 million / initial spot rate = 1.4 / 1.454 = £ 0.9628 million

next :

calculate the final amount  Required in $ to maintain 4% Spread

= principal ( $1.4 million ) + interest ( 9% of 1.4 ) = 1.4 + 0.126 = $1.526 million

In pound ( at the expected spot rate )

= 1.526 / 1.43 = £1.067 million

expected profit = £1.067 - £0.9628 = £ 0.1042 million

Therefore the interest rate tp maintain the 4 percent spread

= 0.1042 / 0.9628 = <em>10.82%</em>

B) <u>Determine the net interest margin if the bank hedges its forward foreign exchange exposure</u>

Forward rate = 1.46

assuming interest as value calculated above = ( 10.82% )

lending amount = £0.9628 million

Repayment = 0.9628 * 111%  * 1.46 = $1.5603 million

therefore return rate = $1.5603 - $1.4  = $0.1603 million = 10.27%

hence : Net interest margin = 10.27% - 5% = 5.27%

<u> C)  Determine the loan rate to maintain the 4 percent spread if the bank intends to hedge its exposure using the forward rates.</u>

Forward Hedging contract forward rate =  1.46

lending amount = $1.4 / 1.454 =  £ 0.9628 million

Total Interest and Principal Repayment Required in $ to maintain 4% Spread = $1.526 million

In pound = 1.526 / 1.46 = £ 1.0452

Interest = £1.0452 -  £0.9628 =  £0.0824 million

therefore interest Rate to maintain 4℅ Spread

= ( 0.0824 / 0.9628 ) * 100  = 8.56%

3 0
2 years ago
The reference section of scholarly articles often get ignored; not good. Which one of the following is a good reason to not only
GREYUIT [131]

A good reason why it is important not just to read but to also reference things appropriately would be to avoid the issues of plagiarism.

<h3>What does it mean to reference a work?</h3>

This is the term that is used to refer to the fact that a work has been accredited to the rightful people that own. When someone is writing, they may list several ideas from an outside sources, it is advised to reference the people that own the work that has been used in this writing.

Hence we can say that a good reason why it is important not just to read but to also reference things appropriately would be to avoid the issues of plagiarism.

Read more on scholarly articles here: brainly.com/question/18754197

#SPJ1

5 0
1 year ago
The fundamental relationship between savings and investment spending in an economy is that: A. savings will increase as investme
Romashka-Z-Leto [24]

The correct option is B

<u>Explanation:</u>

In an economy, planned investment spending is always equal to planned saving. If actual saving falls short of (exceeds) planned saving, then actual investment falls short of (exceeds) planned investment.

That is the other part of the saving paradox. If an economy produces too much, such that saving is greater than planned investment, inventory will build up, giving signal to producers to reduce output, to restore equilibrium. Such investment scheme is suitable only to communist countries. Keynes has another investment theory in his liquidity story. But investment theories are equally a posterior.

Therefore, Option B is correct

8 0
3 years ago
A firm has $1.5 million in sales, a Lerner index of 0.57, and a marginal cost of $50, and competes against 800 other firms in it
MrRissso [65]

Answer:

$116.28

Explanation:

This can be calculated as follows:

Mark up = [1 ÷ (1 - Lerner index)]

Price = Mark-up × Marginal cost

        = [1 ÷ (1 - 0.57)] × $50

Price = [1 ÷ 0.43] × $50 = $116.28  

Therefore, the price this firm will charge its customers is $116.28.

7 0
3 years ago
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