Answer:
Hasalot has a near absolute advantage in Diamontite.
Explanation:
in this scenario, the best which describes the situation that Hasalot has a near absolute advantage in Diamontite.
Answer:
D) foreign; domestic
Explanation:
The central Bank can improve the domestic currency by using the reserves. If the domestic currency undervalued the central bank may intervene to sell the Foreign currency and purchase the domestic currency, which will increase the demand of domestic currency and increase the supply of foreign currency in the market which will improve the value of domestic currency and undervalue the foreign currency.
Answer: C) SDA Corp. stock's alpha is -4.5%
Explanation:
Calculate the required return using the Capital Asset Pricing Model.
= risk free rate + beta ( market return - risk free rate)
= 6% + 1.5 (13% - 6%)
= 6% + 10.5%
= 16.5%
The expected return on the stock is 12% yet the required return is 16.5%. This means that this stock is overpriced because it is giving a return less than what it should be giving.
The alpha is therefore;
= Expected return - Required return
= 12% - 16.5%
= - 4.5%
Essential!! it’s very essential to solving
