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liq [111]
3 years ago
5

Assume that the interest rate on borrowings in Argentina is 3 percent, but the interest rate on deposits in British banks is 9 p

ercent. A trader borrows 1 million Argentine pesos, then converts the money into British pounds and deposits it in a British bank. What is the trader involved in
Business
1 answer:
defon3 years ago
3 0

Answer:

carry trade

Explanation:

Carry trade can b defined as borrowing funds at a low interest rate and then investing those funds in assets that generate a higher return. This way, you profit will be the difference between the higher rate of return yielded by the asset minus the low interest rate paid for the loan. Carry trade is a type of arbitrage since you are obtaining a good at a certain price (low interest rate) and placing it at a higher price (higher rate of return).

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On September 15, 2021, Oliver's Mortuary received a $3,600, nine-month note bearing interest at an annual rate of 14% from the e
pentagon [3]

Answer:

The Journal entry is as follows:

On December 31, 2021

Interest Receivable A/c Dr. $147

          To Interest revenue A/c      $147

(To record the interest receivable)

Working notes:

Interest Receivable:

= Amount received × Annual rate of interest × Time period

= $3,600 × (14% ÷ 12) × 3.5

= $3,600 × 0.01167 × 3.5

= $147

8 0
3 years ago
Different ____ levels and _______ requirements affect the choice of market entry
joja [24]
The answer to this question is Risk;Resources
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3 0
3 years ago
Treasury bills are currently paying 6 percent and the inflation rate is 3 percent. a. What is the approximate real rate of inter
nexus9112 [7]

Answer: a. 2.90%

b. 2.81%

Explanation:

Nominal rate = 6%

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a. What is the approximate real rate of interest?

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= Nominal rate - Inflation rate

= 6.0% - 3.1%

= 2.90%

b. What is the exact real rate?

Exact real rate will be calculated as:

= (nominal-inflation) / (1+inflation)

= (6.0% - 3.1%) / (1 + 3.1%)

= 2.9% / 1.031

= 2.81%

3 0
2 years ago
Mack reynolds, the manager of the special products division, must decide whether to bid or not, and if intermodular semiconducto
REY [17]
"from" (and any subsequent words) was ignored because we limit queries to 32 words.
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2 years ago
Future changes in automobile technology are likely to include
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