Answer:
Caveat emptor is the correct answer.
Explanation:
Answer:
The arbitrageur should borrow money at 4% per annum since it is cheaper than paying the forward price for delivery
Explanation:
Current price of gold=$1,400 per ounce
Forward price=$1,500
The arbitrageur can either pay the forward price or borrow $1400 and pay the interest of 4% in a year. Consider option 1 paying the forward price of 1500
Option 1
Since there are no additional costs, the total cost for buying the gold=forward price=$1,500
Option 2
If the arbitrageur borrows the 1400 to pay for the gold now, then pay the interest in 1 year;
The total cost=Amount borrowed+interest accrued in 1 year
Total cost=1400+(4%×1400)
1400+((4/100)×1400)
1400+56=$1456
Since there are no additional costs, option 2=$1456
If we compare option 1 to option 2, we notice that option 2 is slightly cheaper than option 1 by $44
(Option 1-Option 2)=(1500-1456)=$44
The arbitrageur should borrow money at 4% per annum since it is cheaper than paying the forward price for delivery
Answer: By linking his website to other popular websites.
Hope this helps you.
Answer:
Check the following calculation
Explanation:
Current price : D0(1+g)/(Rs-g)
8 (1+.02)/(.13-.02)
8* 1.02 / .11
= $ 74.18 per share
2) Dividend: 8(1+.02) = 8.16
Annual rate of return : [P1- P0+D ]/P0
[74.18 - 63 + 8.16 ]/63
19.34/63
.3070 or 30.70%
Answer:
A. Start by using the = in the cell where you wish to put the information.
Explanation:
Click the cell you want to place the information, then enter the " = " sign in it. Move the cursor to the sheet from which you want to retrieve information and click the cell with the information you want to retrieve. Automatically excel displays that information on the first sheet.
