B. False. There are usually multiple choices depending on credit score and such.
Answer:
C) Sell £2,278.13 forward at the 1-year forward rate, F1($/£), that prevails at time zero.
Explanation:
given data
State 1 State 2 State 3
Probability 25% 50% 25%
Spot rate $ 2.50 /£ $ 2.00 /£ $ 1.60 /£
P* £ 1,800 £ 2,250 £ 2,812.50
P $4,500 $4,500 $4,500
solution
company holds portfolio in pound. so to get hedge, they will sell that of the same amount.
we get here average value of the portfolio that is
The average value of the portfolio = £ (0.25*1800 + 0.5*2250 + 0.25*2812.5)
The average value of the portfolio = 2278.13
so correct option is C) Sell £2,278.13 forward at the 1-year forward rate, F1($/£), that prevails at time zero.
Answer:
7,727 units
Explanation:
According to the scenario, computation of the given data are as follows:
Department S beginning = 500 units
Completed % in process = 70%
Total completed during period = 7,600 units
End of period = 900 units 53 % completed
So, we can calculate the units of production using FIFO method.
Check attachment for the Solution.
The attachment is attached below.
Answer:
The correct answer is letter "B": Other things remaining equal, the present value of a future cash flow decreases if the investment time period increases.
Explanation:
Present Value informs us how much a future sum of money today is worth, given a defined return rate. This is an important financial concept based on the principle that the money received in the future is not worth as much as today's equivalent amount.
For instance, three years from now, $5,000 received is not worth as much as $5,000 received today. If you are investing the $5,000 now, it will be worth more than the original amount assuming a calculated rate of return in two years. Waiting for two years to invest the money is a two-year loss of interest, making the future money worth less than the $5,000 now.
Answer:
(A) $500 million
(B) This type of analysis is used to show that Special Interest Groups tend to press the government for TRANSFERS instead of ECONOMIC GROWTH.
Explanation:
1/10,000 of the real GDP is = $50,000
RGDP = 50,000 ÷ 1/10,000
RGDP = 50,000 × 10,000 = $500,000,000
If special interest group Q would have to be indifferent (not care which policy is applied at the given time) between the 2 policies, then the economic growth policy would have to increase the size of the RGDP (the economic pie) by an amount sufficient enough for them to get their net benefit of $50,000.
The RGDP figure above ($500 million) is the amount by which RGDP (real gross domestic product) should grow, if Group Q will still get their net benefit when only the economic growth policy (EGP) is applied.
In this case, the EGP applied in place of the TP (transfer policy) would still fetch Group Q the minimum net benefit of $50,000
(B) This type of analysis is used to show that Special Interest Groups tend to press the government (policy makers and enforcers) for TRANSFERS instead of ECONOMIC GROWTH.
