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vfiekz [6]
3 years ago
9

Assume that the interest rate on borrowing in Japan is 1 percent, while the interest rate on deposits in Australian banks is 5 p

ercent. A trader borrows in yen and then converts the money into Australian dollars and deposits it in an Australian bank to make a 4 percent margin. Which type of trade is this an example of?
a, swing trade
b, carry trade
c, channel trade
d, price action trade
Business
1 answer:
Svetllana [295]3 years ago
6 0

Answer:

The correct answer is option is b.

Explanation:

Swing trade is a trading strategy where attempts are made to earn profit from the stocks in a span of a few days.  

Carry trade is a type of currency trading strategy. Under this strategy, money is borrowed in a currency which has a lower interest rate then converted and deposited into the currency which has higher interest rates. In this way, profit is earned.  

Under channel trading strategy, the trading is done in a certain channel which represents the value of assets for a specific period. It is for short term and medium term.  

Under the price action trading strategy, the price movements in the market are studied and trading is done on this basis.

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A company’s weighted average cost of capital is 10.8% per year and the market intrinsic value of its debt is $33.1 million. The
VashaNatasha [74]

Answer:

C. $11.03

Explanation:

We need to first compute the firm's value which is shown below.

Firm's value = Free cash flow ÷ (Weighted average cost of capital - Growth rate)

Firm's value = $4.7 million ÷ ( 10.8% - 3.7%)

= $4.7 million ÷ 7.1%

= $66,197,183

Stock price = (Firm value - Debt) ÷ Number of shares

= ($66,197,183 - $33,100,000) ÷ 3,000,000

= $33,097,183 ÷ 3,000,000

= $11.03

4 0
3 years ago
The managers at Speed Automobile Inc. want to diversify the business by acquiring a consumer electronics company. This acquisiti
trapecia [35]

Answer:

principal-agent problem

Explanation:

In a corporation, the principal-agent problem refers to conflict of priorities that exist between the shareholders and the management. Management has the duty of increasing the corporation value, and therefore increasing the shareholders' wealth. But sometimes, management makes decisions that benefit them more than the shareholders. This conflict of interest can be really dangerous for a corporation, since managers may safeguard their own personal interests and sacrifice the corporation's future value.

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3 years ago
Types of long term insurance offered by outsurance
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The types of long term insurance offered by outsurance are :
- Death insurance
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8 0
3 years ago
Read 2 more answers
Two special methods vital to marketing researchers are __________ and __________.
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5 0
2 years ago
Jane is 20 years old and is a sophomore at Lake University. She is a full-time student and does not have any gross income. Jane
OLga [1]

Answer:

c. Jane grandparents cannot claim her as a dependent because Jane provided more than half of her own support.

Explanation:

Based on the information given the statements regarding the dependency rules for Jane that is true is Jane grandparents cannot in any way claim Jane as a dependent reason been that Jane provided more than half of her own support due to the fact that she her s total support for is the amount of $30,000 which as well include a scholarship of the amount of $5,000 to help cover tuition in which Jane used the amount of $12,000 of her savings while her grandparents on the other hand only provided the amount of $13,000 out of the Total support of $30,000.

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2 years ago
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