In considering the market for yen and dollars, when the dollar depreciates:________

Suppose that the spot price of the euro is currently $1.30. The 1-year futures price is $1.35. Is the interest rate higher in th

valkas [14]

Answer:

The interest rate is higher in the US.

Explanation:

The forward price is calculated using the following formula,

F= S ( 1+Rd / 1+Rf)^t

where,

F = Forward rate
S = Spot rate
Rd = Nominal interest rate in domestic market
Rf = Nominal interest rate in foreign market
t = time in years

We consider that the domestic market is the US and the domestic currency is the USD. Thus, it is a direct quote where 1 EUR = 1.3 USD

The forward price ER is more than the Sport ER only when the interest rate in domestic market is more than the interest rate in foreign market and as a result, the value of domestic currency against a foreign currency in the forward market depreciates.

We can see this by the following example,

Say Spot rate is $1.3 per 1 EUR and the interest rate in US is 10% while that in Euro zone is 5%. When we calculate the forward ER we will see that 1 EUR will buy us more USD in forward (more than 1.3 USD)

F= 1.3 * (1.1 / 1.05)^1 => $1.362 PER 1EUR

3 0

3 years ago

The price of stadium seats at a baseball game increases from $20 to $30 and ticket sales fall from 45,000 per game to 35,000 per

Xelga [282]

Answer:

Inelastic

Explanation:

Price Elasticity of demand is the a measure which is used to show the responsiveness of the quantity to its price.

Price Elasticity of demand = Change in quantity / Change in price

% Change in quantity = ( 45,000 - 35,000 ) / 45,000 = 22.22%

% Change in price = ( 20 - 30 ) / 20 = -50%

Price Elasticity of demand = Change in quantity / Change in price

Price Elasticity of demand = 22.22% / -50% = -0.4444

As the answer is less than 1 so, demand is Inelastic.

8 0

3 years ago

During 2015 Lopez Corporation reported net sales of $3,200,000 and net income of $1,200,000. Its balance sheet reported average

Sholpan [36]

The asset turnover is 2.4 times.

Asset turnover = Net sales \div Average total assets

Asset turnover = $3,000,000 \div [ $1,000,000 + $1,500,000 ] \div 2

Asset turnover = 2.4 times

Asset turnover is the ratio of total sales or revenue to average assets. This metric helps investors understand how effectively companies are using their assets to generate revenue. Investors use asset turnover to compare similar companies in the same industry or group.

In the retail sector, an asset turnover of 2.5 or higher may be considered good, but in the utility sector, a company is more likely to aim for an asset turnover between his 0.25 and 0.5.

Learn more about asset turnover at

brainly.com/question/13401474

#SPJ4

8 0

2 years ago

Think of two advertisements that you have seen recently, one that you like and one that you dislike. What is each ad trying to s

Alisiya [41]

Answer and Explanation:

An advertisement that I have seen frequently and that has caught my attention is an advertisement about Shampoo for dogs. This announcement has a color palette that I like very much, it has a feeling of balance and freshness. This makes me believe that the dog will feel these sensations if he uses this product, which makes me want to buy it immediately. The dog images, used in the ad, also reinforce this desire, since all dogs are well treated and with very beautiful hair.

However, an ad that has not convinced me to buy the product is an advert about face moisturizer. Although the advertisement is well produced, it promises a miraculous product with effects beyond the capacity of a moisturizer. When watching the ad I feel somewhat deceived and I have negative feelings about the product.

5 0

3 years ago

The Fabricating Department started the current month with a beginning Work in Process inventory of $11,200. During the month, it

SVETLANKA909090 [29]

Answer:

The ending balance of the Work in Process Inventory account for the Fabricating Department is: $11,200

Explanation:

To determine Ending Balance of Work in Process Inventory, Prepare a Manufacturing Cost Statement.

Opening Work in Process Inventory $11,200

Add Cost Added During the Period :

Direct materials $77,200

Direct labor $25,200

Factory overhead ( $25,200 × 50%) $12,600

Total Manufacturing Costs $126,200

Less Transfer to Next Department ($115,000)

Closing Work in Process Inventory $11,200

Conclusion :

Therefore, the ending balance of the Work in Process Inventory account for the Fabricating Department is: $11,200

6 0

3 years ago

In considering the market for yen and dollars, when the dollar depreciates:_________