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2 years ago

__________ is the amount a business earns after deducting what it spends for salaries and other expenses.

Business

1 answer:

Lana71 [14]2 years ago

4 0

Answer:

profit

Explanation:

profit is a financial return or reward that an entrepreneur aims to achieve to reflect the risk it takes. Profit is also an important signal to other providers of finance to a business. Banks, suppliers and other lenders are more likely to provide finance to a business that can demonstrate that it makes a profit and that it can pay debts as they fall due.

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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

A) Determine the loan rate to maintain the 4 percent spread

Expected spot rate = 1.43

First step :

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

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 = 10.82%

B) Determine the net interest margin if the bank hedges its forward foreign exchange exposure

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%

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

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

Which animals in the food web are secondary consumer ?

ValentinkaMS [17]

Answer:

Soooooooooooooo the examples of secondary consumers include bluegill, small fish, crayfish and frogs.

Explanation:

5 0

2 years ago

Get master dude . Its worth it just answer the question by saying MASTER

Brums [2.3K]

Answer:

MASTER

Explanation:

Apparently it says to write it so that's is what I did is there anything wrong about that bye

8 0

2 years ago

Read 2 more answers

After conducting research, you will need to generate ideas and organize the collected data. Simple organizational techniques wil

ZanzabumX [31]

Answer:

The three major components in the preceding scratch list are High-End Linens, Affordability and Food & Drinks.

i. High-End Linens

List that falls under it includes 600-thread-count sheets, Double-thick bath towels, Silk pillowcases, Raw silk curtains with gold embellishments

ii. Affordability

List that falls under it includes $100/night four-star rooms, Free snacks, shampoo, and conditioner , Free wireless Internet

iii. Food and drink

List that falls under it includes Coffee maker with selected teas, Imported beer , Fresh-squeezed juices

4 0

2 years ago

A competitive car wash currently hires 4 workers, who together can wash 80 cars per day. The market price of car washes is $5 pe

Bezzdna [24]

Answer:

b) 100 cars per day.

Explanation:

With the information above, we can conclude that each worker washes 20 cars per day, and earns a wage of $60 per day.

So the total labor costs per day is $60 wage per worker X 4 workers = $240

The total sales revenue per day is: 80 cars washed per day X $5 per wash = $400.

So, we can see that with four workers, the firm has a good profit of = $400 - $240 = $160.

If the firm hired a fifth worker, labor costs would increase to $320 ($240 + $60), the amount of cars washed would increase to 100, and the sales revenue would increase to $500 (100 x $5).

So, profits would increase to $180 ($500 - $320) if the firm hired a fifth worker.

However, productivity should still be stable, so a worker who washed less than 20 cars per day should not be hired, this is why the A option is wrong.

8 0

2 years ago