75 I think not 100% but that makes Sense
Answer:
C. ≈2,413 gallons
Explanation:
For computing the average inventory, first we have to determine the economic order quantity which is shown below:
=
= 
= 4,827.1079 gallons
The carrying cost is
= Price of fuel × holding cost per unit
= $3.09 × 30%
= $0.927
Now the average inventory of fuel is
= Economic order quantity ÷ 2
= 4,827.1079 gallons ÷ 2
= 2,413 gallons
The velocity of money is not directly controlled by the Fed. The Fed can not control the money supply and the meaning for that is that the Fed can not create rising demand. when we talk about volecity we are talking about the speed that money turns over. That is why velocity is out of control of the Fed.
Answer:
Option (b) is correct.
Option (b) is correct.
Explanation:
1. Pure Expectation Theory :
Each option must provide the same amount of cash at the end of 2 years, which implies that,
CF at the end of year 2 = CF at the end of year 1
[tex](1+0.0738)^{2} = (1+0.0492) (1+x)
[tex\]
Hence, x = 9.90
so the market's estimate of the one year Treasury rate one year from now it will be 9.90%
2. In case of maturity risk premium, the cash flow of two year treasury security will reduce, it will be:
= 7.38 - 0.40
= 6.98.
Hence, Treasury Rate will be as follows:
CF at the end of year 2 = CF at the end of year 1
[tex](1+0.0698)^{2} = (1 + 0.0492) (1 + x)[tex\]
x = 9.080%
