1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
sergeinik [125]
3 years ago
12

A futures contract on corn that matures exactly 6 months from now is trading at $3.32 per bushel. The spot price of corn is $3.2

0. If the continuously compounded annual risk-free rate is 5%, then the arbitrage strategy right now is: Multiple Choice Short the futures contract; Borrow at the risk-free rate; Long corn; Long the futures contract; Borrow at the risk-free rate ; Short corn; Short the futures contract; Invest at the risk-free rate; Long corn; Long the futures contract; Invest at the risk-free rate ; Short corn;
Business
1 answer:
TiliK225 [7]3 years ago
8 0

Answer:

Short the futures contract; Borrow at the risk-free rate; Long corn;

Explanation:

Spot rate = $3.20

Therefore implied future rate = spot x ert

Therefore implied future rate = 3.20 x e0.05 x 6/12

Therefore implied future rate = 3.20 x 1.025315

Therefore implied future rate = 3.281

Since implied future rate < future rate, we will short future contract and borrow and buy at spot

Therefore, 1st choice is correct

You might be interested in
Over the past 30 years, most economies of the world have begun moving toward the market end of a spectrum that ranges from pure
mestny [16]

Answer:

Explanation:

Based on the information provided within the question it can be said that this scenario has led to the United States adding more planned elements to the economy. They are doing this in order to prevent the market from hitting a pure market economy and remaining balanced towards a more planned economy.

4 0
3 years ago
Complete this template by replacing the bracketed text with the relevant information. Also cite your sources where information w
NikAS [45]

Hello and welcome to Brainly! I'm Gabriella and I'm a part of the Engagement team on Brainly. Thank you for posting your first question! I hope you enjoy your time here on Brainly! If you have any questions about navigating and understanding the Brainly website, don't hesitate to reach out to me or anyone else on the Engagement team!

8 0
3 years ago
Mark produced 9 cans of sauce with 3 pounds of tomatoes. When he increased to 5 pounds, he produced 13 cans. What is the margina
MakcuM [25]

Answer:

Marginal Product is 2

Explanation:

Marginal Product (MP)  is defined as the ration of change in quantity of output produced to the change in quantity of input raw material

Change in quantity of input raw material = 5 -3 = 2

Change in quantity of output of products = 13 - 9 = 4

Marginal Product (MP) = \frac{4}{2} = 2

Marginal Product is 2

8 0
3 years ago
Disbursements float: A) occurs when a deposit is recorded but the funds are unavailable. B) causes the book balance to exceed th
Rudik [331]

Answer:

The correct answer is letter "E": is generally more desirable to companies than collection float.

Explanation:

Disbursement floats refer to the amount of money a company has spent but has not been discounted from its account yet. This usually happens when the company makes wire transfers to different banks or issues checks that take to clear some days.  

<em>Disbursement floats are preferred for a company compared to collection float since the latter is based on debts that the firm has not been able to pay yet while disbursement floats are just the result of unfinished transactions the company has already taken responsibility for.</em>

5 0
3 years ago
Read 2 more answers
World-class performance measures can be used in different functional areas of a firm to satisfy objectives, enhance the value of
Alex777 [14]

Answer:

D) All of these

Explanation:

World class performance measures can be used in different functional areas, for example International Organization for Standardization (ISO) norms apply to all the functional areas of a company:

  • ISO 9000 - Quality Management
  • ISO 27000 - Information Security Management Systems
  • ISO 14000 – Environmental Management
  • ISO 31000 - Risk Management
  • ISO 50001 - Energy Management
  • ISO 26000 - Social Responsibility
  • ISO 28000: 2007 – Specifications for Security Management Systems for the Supply Chain
  • ISO 37001: 2016 Anti-Bribery Management Systems
  • ISO 45001 – Occupational Health and Safety
  • ISO 22000 – Food Management Systems

Other types of world class performance measures that are not as established and recognized as ISO norms, but are gaining momentum in modern management like World Class Manufacturing (WCM) framework focus on four main areas:

  • Manufacturing competitive products: measure quality performance
  • Manufacturing product mix and volume: measure cost performance  
  • Short lead-times and make-to-order: measure delivery performance  
  • New product introductions: measure flexibility performance

5 0
4 years ago
Other questions:
  • Indra nooyi, ceo and chairman of pepsico is considered the most powerful woman on fortune’s 50 most powerful women’s list, uses
    10·1 answer
  • Which is NOT true regarding differences between goods and​ services? A. Services tend to have higher customer interaction than g
    8·1 answer
  • Westchester Corp. is considering two equally risky, mutually exclusive projects, both of which have normal cash flows. Project A
    10·1 answer
  • If a quota is set above the equilibrium quantity, there will be: missed opportunities in the form of mutually beneficial transac
    15·1 answer
  • If the Federal Reserve tries to target inflation near 2%, the inflation rate is 2.1%, and output is 4% below potential GDP, the
    6·1 answer
  • The only skill required of managerial accountants is that they have a solid knowledge of both financial and managerial accountin
    8·1 answer
  • Which of the following statement is false? Group of answer choices Depreciation is a noncash expense Depreciation is the process
    6·1 answer
  • These are the times that try men's souls. The summer soldier and the sunshine patriot will, in this crisis, shrink from the serv
    15·1 answer
  • Metallica Bearings, Inc., is a young start-up company. No dividends will be paid on the stock over the next 7 years because the
    5·1 answer
  • Evaluate the key criteria and selection process to use when considering which international market to enter.Case study:McDonald’
    12·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!