Answer:
b. comparative advantage
Explanation:
Opportunity cost also known as the alternative forgone, can be defined as the value, profit or benefits given up by an individual or organization in order to choose or acquire something deemed significant at the time.
Simply stated, it is the cost of not enjoying the benefits, profits or value associated with the alternative forgone or best alternative choice available.
For example, if you decide to invest resources such as money in a food business (restaurant), your opportunity cost would be the profits you could have earned if you had invest the same amount of resources in a salon business or any other business as the case may be.
In this scenario, Farmer Jane's opportunity cost of producing corn is lower than Farmer John's, therefore, she has a comparative advantage in producing corn.
Comparative advantage in economics is the ability of an individual or country to produce a specific good or service at a lower opportunity cost better than another individual or country.
Hence, the comparative advantage gives an individual or country a stronger sales margin than their competitors as they are able to sell their specific products or render their peculiar services at a lower opportunity cost.
Answer:
The probability to put sock and shoe on all legs is 1/2^8. Therefore the number of correct permutations must be 16!/2^8.
Explanation:
There are two actions for each leg - the sock and then the footwear. All we need to know is to determine a sequence when each leg has been worked on. That is 16/2 for the first section, 14/2 for the second, and so on...
Equivalently, the multinomial coefficient would be (16/2,2,…, 2) = 16!/2^8.
Answer:
all portfolios and individual securities.
Explanation:
CAPM is an acronym for capital asset pricing model. The capital asset pricing model (CAPM) can be defined as a model or formula that can be used to calculate an investment risk and the expected return on an investment (assets).
Simply stated, the capital asset pricing model gives an investor the relationship between the risk of investing in securities and its expected returns. Thus, it assists investors in making well-informed decisions about whether or not to add to a portfolio.
Additionally, the expected return could be either a profit or loss depending on the risks associated with the securities.
Mathematically, the CAPM is given by this formula;
Where;
<em>In a nutshell, it is important to note that the capital asset pricing model (CAPM) applies to all portfolios and individual securities. </em>
Answer:
a) Bond A's current yield is greater than that of Bond B.
TRUE As every other alternative as been proveed incorrect
Also, this satement refers to the amount stated in the coupon rate.
Explanation:
c) Bond A trades at a discount, whereas Bond B trades at a premium.
FALSE
A trades as premium as thei coupon rate is higher than market value so investor are willing to purchase at a hihger price until achieve the 8% return
d) If the yield to maturity for both bonds remains at 8%, Bond A's price one year from now will be higher than it is today, but Bond B's price one year from now will be lower than it is today.
FALSE As A is traded at premium it will decrease over time to match the face value
e) Bond A's capital gains yield is greater than Bond B's capital gains yield.
FLASE As Bond A will decrease their price over time it will make capital losses.
