Answer:
Explanation:
Given that:
a)
1$ = Can $1.12
It takes a value of 1 U.S dollar to have 1.12 Canadian dollars. This signifies that the U.S dollar is worth more than Canadian dollars.
b)
Assuming that the absolute Purchasing Power Parity PPP holds,
Since 1$ = Can $1.12, the cost in the United States of an Elkhead beer, if the price in Canada is Can$2.85 can be determined to be:
= 
= $2.545
c)
Yes, the U.S. dollar is selling at a premium relative to the Canadian dollar.
This is because we are being told that the spot exchange rate for the Canadian dollar is Can $1.12 & in six (6) months time the forward rate will be Can $1.14.
d)
The U.S dollar is expected to appreciate in value because it is trading at a premium in the forward market.
e)
Canada has higher interest rates. This determined by using the formula:
= 
where; n= numbers of years = 6 month/12 month = 0.5 year
Then;
= 0.0356
= 3.56%
Answer:
The future value of these cash flows at the end of year 4 is $71,885.80
Explanation:
In order to calculate the future value of these cash flows at the end of year 4 we would have to use the following formula:
n
∑
FV = i=1 [CFi * (1 + r)(n - i)]
FV = [$11,800 * (1 + 0.10)∧(4-1)] + [$14,000 * (1 + 0.10)∧(4-2)] + [$18,200 * (1 + 0.10)(4-3)] + [$19,000 * (1 + 0.10)(4-4)]
FV = $15,705.80 + $16,940 + $20,020 + $19,000
FV=$71,665.80
The future value of these cash flows at the end of year 4 is $71,885.80
Incurring actual indirect factory wages in excess of budgeted amounts for actual production results in a controllable variance. Therefore, the option B holds true.
<h3>What is the significance of controllable variance?</h3>
Controllable variance can be referred to or considered as a variance that computes the difference between the actual quantity and the budgeted quantity sold or consumed by a firm in an economy. It can never be deficit, and is always in surplus of the budgeted amounts.
Therefore, the option B holds true and states regarding the significance of controllable variance.
Learn more about controllable variance here:
brainly.com/question/13985361
#SPJ4
The question seems to be incomplete. It has been added below for better reference.
Incurring actual indirect factory wages in excess of budgeted amounts for actual production results in a:
a. quantity variance
b. controllable variance
c. volume variance
d. rate variance
