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Nutka1998 [239]
4 years ago
10

Suppose that the risk-free rates in the United States and in the United Kingdom are 4% and 6%, respectively. The spot exchange r

ate between the dollar and the pound is $1.60/BP. What should the futures price of the pound for a one-year contract be to prevent arbitrage opportunities, ignoring transactions costs
Business
1 answer:
gizmo_the_mogwai [7]4 years ago
4 0

Answer:

The futures price of the pound for a one-year contract be to prevent arbitrage opportunities would be $1.63/BP.

Explanation:

In order to calculate the the futures price of the pound for a one-year contract be to prevent arbitrage opportunities we would have to make the following calculation:

futures price of the pound for a one-year contract=Spot rate*(1+United Kingdom risk free rate)/(1+United States risk free rate)

futures price of the pound for a one-year contract=$1.60/BP*(1+6%)/(1+4%)

futures price of the pound for a one-year contract=$1.63/BP

The futures price of the pound for a one-year contract be to prevent arbitrage opportunities would be $1.63/BP.

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Last week, michelle spent $30 on caviar. today, michelle still spends $30 on caviar even though its price has doubled. what is m
Liula [17]
Price elasticity of demand describes how the quantity demanded changes with a change in price. It describes how responsive demand is to price. 

The formula for elasticity is:
e = %change in Quantity ÷ % change in price
Keep in mind that this number will almost certainly be negative, since an increase in price should decrease demand. 

The problem tells us that price has doubled. This represents a 100% increase in price: Michelle still spent $30 dollars, although this $30 bought her half as much caviar since the price is twice what it was. This means her quantity demanded, or purchased, fell by 50%. 

e= -50% ÷ 100%
e = -0.5

This tells us, more generally, that a x% increase in the price reduces demand by x/2%. 
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Suppose that you want to recreate shulte's study in the great wicomico river and make nine reef complexes as shown above. you wo
anyanavicka [17]

Answer:

The best sampling protocol to be used here include <em><u>Random Sampling approach</u></em> to select sites on different reef types from several of the reef complexes.

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Simple random sampling is most appropriate when the entire population from which the sample is taken is homogeneous. The sample here is Oyster Density.

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