Answer:
If RUS > RUK, then E < F ( C )
Explanation:
RUS = annual risk free rate in united states
RUK = annual risk free rate in United kingdom
F = futures price of $/BP for 1 year
E = spot exchange rate for $/BP
To get a higher the future price
this conditions must be met
The annual risk free rate of the united states must be higher than the annual risk free rate of the united kingdom. if this condition is met then the the British pound will have a forward premium ( F ) > ( E )
Answer:
The answer is stated below:
Explanation:
The challenges which one would face and these are:
1. Hiring especially and retaining the top talent.
2. Secure the budget.
3. Economic fluctuations.
4. Trained professionals.
5. Evaluation of ROI (Return on Investment) on activities of the marketing.
When the company or firm faces the limitations grounded on the real world situations then all of the mentioned above will be a challenge for the company. The firm or the company will have to meet the fluctuation which is linked with the economic conditions as well as the currency.
When the assumptions are build as a simulation then the company or the firm will not be in a position to take the risk. The assumption could cause the firm to travel safely in the economy, in order to take or face the challenges the firm should ready to face the risks and have the plans in respect to tariffs, currency and other barriers.
If the firm wants to play safe then should be open to all the fluctuations and prepared to meet the ups as well as downs in the business.
So, assumptions should be made in such a way that they safeguard or protect the company but should not be such that it will limit the company growth.
Answer:
d. This cannot be determined from the given information
Explanation:
To find the average revenue of 200 units it is necessary to know the total units. However, the function of the marginal revenue is not given. It is impossible to infer the marginal revenue (price) of other units (of output) only from knowing the marginal revenue of the 100th unit.
Answer:
B) ROE is a forward-looking, one-period measure, while business decisions span the past and present
Explanation:
ROE is a forward-looking, one-period measure, while business decisions span the past and present, this statement does not describe a problem with using ROE as a performance measure.
Answer:
b. $.66
Explanation:
The computation of the per share value for the one year is
Given that
Current Price = $43
Possible Prices = $42 and $46
Now
u = [($46 - $43) ÷ $43] + 1
= 1.06977
And
d = 1 - [($42 - $43) ÷ $43]
= 0.9767
And,
Risk-Free Rate = T-Bill Rate = Rf = 4.1 %
Now the up move price probability is
= [(1 + Rf) - d] ÷ [u - d]
= [(1.041) - 0.9767] ÷ [1.06977 - 0.9767]
= 0.69088
And,
Exercise Price = $ 45
Now
If the Price is $42, so Payoff = $0
And
if the Price is $46, so Payoff =is
= ($46 - $45)
= $1
Finally the call price is
= [0.69088 × 1 + (1 - 0.69088) × 0] ÷ 1.041
= $0.66367
= $0.66
