In economics, diminishing returns is the decrease in the marginal (incremental) output of a production process as the amount of a single factor of production is incrementally increased, while the amounts of all other factors of production stay constant.
Answer:
Consider the following information for three stocks, A, B, and C. The stocks' returns are positively but not perfectly positively correlated with one another, i.e., the correlations are all between 0 and 1. Expected Standard Stock Return Deviation Beta
A 10% 20% 1.0
B 10% 10% 1.0
C 12% 12%1.4
Portfolio AB has half of its funds invested in Stock A and half in Stock B. Portfolio ABC has one third of its funds invested in each of the three stocks. The risk-free rate is 5%, and the market is in equilibrium, so required returns equal expected returns. Which of the following statements is CORRECT?
Question 13 options:
a) Portfolio ABC's expected return is 10.66667% correct answer
. b) Portfolio AB has a standard deviation of 20%.
c)Portfolio ABC has a standard deviation of 20%.
d)Portfolio AB's required return is greater than the required return on Stock A.
e)Portfolio AB's coefficient of variation is greater than 2.0
Answer:
Cash outflow of $579,500
Explanation:
Net cash flow is the sum of all cash inflow and outflows of the company.
In this question the company has cash outflow from Spain and inflow from Germany.
As per given data
Cash flow from Spain subsidiary = €5,000,000 outflow
Cash flow from German subsidiary = €4,500,000 inflow
Net cash flow to parent company = - €5,000,000 + €4,500,000
Net cash flow to parent company = - €500,000
The currency is converted using the exchange rate of $1.159 per euro.
Net cash Flow in U.S. dollars = - €500,000 x $1.159 per euro
Net cash Flow in U.S. dollars = - $579,500
Answer:
Lower interest rates – reduce cost of borrowing and increase consumer spending and investment.
Increased real wages – if nominal wages grow above inflation.
Higher global growth – leading to increased export spending.
Devaluation, making exports cheaper and imports more expensive, increasing domestic demand.
Explanation:
Some ways you can help the economy are
1. Lower interest rates – reduce cost of borrowing and increase consumer spending and investment.
2. Increased real wages – if nominal wages grow above inflation.
3. Higher global growth – leading to increased export spending.
4. Devaluation, making exports cheaper and imports more expensive, increasing domestic demand.
