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Andreas93 [3]
3 years ago
5

A basket of goods costs $800 in the u.s. in belgium the basket of goods costs 640 euros and the exchange rate is .80 euros per u

.s. dollar. in japan the basket of goods costs 90,000 yen and the exchange rate is 90 yen per dollar. which country has purchasing-power parity with the u.s.
Business
1 answer:
nignag [31]3 years ago
3 0

Belgium but not Japan

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You purchase one IBM July 120 call contract for a premium of $5. You hold the option until the expiration date when IBM stock se
QveST [7]

Answer:

$200 loss

Explanation:

Long call profit = Max [0, ($123 - $120)(100)] - $500 = -$200.

8 0
4 years ago
Read 2 more answers
1. Explain the difference between required rate of return and expected rate of return. If they are different at a specific point
77julia77 [94]

Answer: The answers to the questions are provided below.

Explanation:

1. The Required Rate of Return(RRR) is the absolute minimum return on an investment that an individual or firm would accept for the investment to be considered worthwhile. The required rate of return helps in deciding whether an investment is worth the cost or not.

An expected rate of return helps in knowing out how much one can expect to make from an investment. An expected rate of return is the return on investment that an individual or firm expects to make when investing in a stock.

The RRR is the least possible rate which would entice someone to invest while the expected rate of return is what the person plan to make from that investment and its calculation is based on probability.

When there is difference between the required rate of return and expected rate of return for an asset at a specific period of time, it means that the economic conditions aren't normal as there is either inflation or deflation in the market.

2. The holding period return is the total return gotten from holding an asset over a particular period of time which is known as the “holding” period while the expected return is the return based on probability-weighted average of likely returns from an investment.

3. Diversification is a technique that is applied to reduce risk through the allocation of investments among several financial instrument and industries. Diversification aims to maximize the returns through investment in different sectors because each sector will likely react differently when there's a risk. Investing in more than one asset through diversification is essential because each asset will react differently when a risk occurs.

3 0
4 years ago
Texas Roadhouse opened a new restaurant in October. During its first three months of operation, the restaurant sold gift cards i
Deffense [45]

Answer:

General Journal Debit Credit

1 Cash 2600  

Unearned revenue  2600

(To record gift cards sold)  

2 Unearned revenue 832  

Sales tax payable  32

Sales revenue  800

(To record gift cards redeemed)

8 0
3 years ago
Evelyn invests $5,000 in a savings account that pays interest at a rate of 6.7% compounded annually. If she withdraws half the i
My name is Ann [436]

Answer:

$371

Explanation:

The computation of additional interest during the fourth year is shown below:

but before that we need to do the following calculations

Amount = Principal × (1 + (rate of interest ÷ (1 × 100)))^(1 × number of years)

A = $5,000 × (1 + (6.7% ÷ (1 × 100)))^(1 × 3)

= $5,000 × (1 + (6.7 ÷ 100))^(1 × 3)

= $5,000 × (1 + 0.067)^3

= $5,000 × (1.067)^3

= 5000 × 1.214

= $6,070

Now, Interest gained after 3 years on the amount of Principal is

= $6,070 - $5,000

= $1,070

Here Evelyn issued interest which is half that is earned at the end of the 3rd year

Sp,

Half of the interest gained will be

= $1,070 ÷ 2

= $535

Now,

The new Principal amount for 4th year is

= $6,070 - $535

= $5,535

So, the final amount in the fourth year is

A = P × (1 + (r ÷ n))^(nt)

= $5,535 × (1 + 0.067 ÷ 1 ]^(1 × 1)

= $5,535 × 1.067

= $5.905.845

Hence the additional interest in the fourth year is

= $5,905.845 - $5,535

= $370.845

or

= $371

Therefore for computing the additional interest during the fourth year we simply applied the above formula.

8 0
3 years ago
Troy Engines, Ltd., manufactures a variety of engines for use in heavy equipment. The company has always produced all of the nec
Masteriza [31]

Given Information:

                                                  Per Unit  15,000 Units  Per Year Direct materials                                        $ 9         $135,000  

Direct labor                                           11              165,000  

Variable manufacturing overhead    2              30,000

Fixed manufacturing overhead, traceable  6*      90,000  

Fixed manufacturing overhead, allocated  13       195,000

Total cost                                                  $41                      $615,000

Solution:

Compute the total cost of making and buying the parts:

                                                    Make                           Buy

Cost of purchasing                        0                         525,000

                                                                               (15,000*35)

Direct materials                             135,000                     0

Direct Labour                                  165000                     0

Variable manufacturing overhead  30,000                    0

Fixed manufacturing overhead       57240                     0

                                                       -----------------------------------------------

Total Relevant cost                           387,240                  525,000

7 0
3 years ago
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