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irina1246 [14]
3 years ago
14

Suppose that the risk-free rates in the United States and in Japan are 5.25% and 4.5%, respectively. The spot exchange rate betw

een the dollar and the yen is $0.008828/yen. What should the futures price of the yen for a one-year contract be to prevent arbitrage opportunities, ignoring transactions costs
Business
1 answer:
kotegsom [21]3 years ago
6 0

Answer:

$0.008891/Yen

Explanation:

The computation of arbitrage free rate is shown below:-

Fair forward rate = Spot rate × (1 + Interest rate US) ÷ (1 + Interest Rate Japan)

= 0.008828 × (1 + 5.25%) ÷ (1 + 4.5%)

= $0.00889135885/Yen

or

= $0.008891/Yen

Therefore for computing the arbitrage free rate we simply applied the above formula.

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Which of the following is an example of crowding out? Question 13 options: A decrease in the rate of growth of the money supply
Dmitriy789 [7]

Answer:

A budget deficit causes an increase in interest rates, which causes a decrease in investment spending.

Explanation:

In domain of economics, crowding out

can be regarded as a phenomenon which take place as a result of increased in involvement of government in market economy sector which substantially has effect on remainder of the market, this effect could be on the supply side, it could be on demand side of the market. An example of crowding out is A budget deficit causes an increase in interest rates, which causes a decrease in investment spending.

7 0
3 years ago
Suppose that the government of Ping's hears of the working conditions and the country seizes the Quality Dragon plant in which P
KATRIN_1 [288]

Answer:

The answer is: A) expropriation

Explanation:

Expropriation is the seizure of private property by a government entity or government agency for the purpose of public interest. Usually owners that lose property due to expropriations, receive some type of compensation for their loss. It also can refer to private property being taken away by another private entity with the authorization of a government entity or agency. A common example of expropriation is land being taken away for building roads or dams.

In this case the Quality Dragon plant was expropriated by a private entity who was authorized by the government and the owner was received a monetary compensation for his loss.

5 0
3 years ago
An amount of $2,500 is deposited in a savings account that earns 2.5% interest. Which is the future value
Lynna [10]

Answer:

$3,208

Explanation:

The computation of the future value is shown below;

As we know that

Future valie = Present value × (1 + rate of interest)^number of years

where

Present value is $2,500

Rate of interest = 2.5% ÷ 4 = 0.625%

And, the time period is = 10  × 4 = 40

So, the future value is

= $2,500 × (1 + 0.625%)^40

= $3,208

5 0
3 years ago
the gradual reduction of regional constrasts resulting form increasing cultural, economic, political and other types of exchange
kondor19780726 [428]

Answer: Globalization

Explanation:

The globalization is the process of gradually reducing the regional contrasts due to the increase in the interaction and exchange different types of culture, political and the economic.

The main aim of the globalization is that it communicate on the international platform by using the different types of strategy for the business, political and also due to the environment development.  

 There are different types of benefits which is provided by the globalization that are:

  • High quality products and the services  
  • Greater economical efficiency
  • More international trading

 Therefore, Globalization is the correct answer.

3 0
3 years ago
Adam Sears is an assembly line employee with Swenson Motors. Though Adam is popular among his supervisors and colleagues, Adam e
Valentin [98]

Answer:

The answer is: D) Adam's job has low task identity.

Explanation:

The task identity of a job can be defined as the extent at which that job involves completing a piece of work.

In Adam´s case, to complete a piece of work refers to assembling a whole car. Adam´s job is very specific, fixing nuts and bolts. It´s the perfect example of specialization of labor. He may be very good at doing that, but doesn´t feel good about it.  

4 0
4 years ago
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