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pshichka [43]
3 years ago
5

Hedge funds report average returns in December that are higher than their average returns in other months. This phenomenon _____

_____. I. is called the Santa effect II. often results from over generous valuation of illiquid assets III. appears stronger for lower-liquidity funds IV. can be explained by managers' attempts to inflate assets to collect higher performance bonuses Group of answer choices g
Business
1 answer:
RSB [31]3 years ago
8 0

Answer:

I, II, III, and IV

Explanation:

A hedge fund is made up of relatively liquid assets that are used to improve performance though short selling, leverage and derivatives.

There is use of complex trading techniques, risk management, and portfolio construction.

Usually a spike in returns occurs during December, this is called the Santa effect.

Managers receive an incentive fee when there is a good past performance of hedge funds.

So during December they tend to inflate the value of hedge funds.

This results in stronger valuation for low liquidity funds

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If the demand for an item increases,what effect will it have an price and quantity? A) price will increase and quantity increas.
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Answer:

A) price will increase and quantity increase.

Explanation:

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The law of increasing opportunity costs is reflected in a production possibilities curve that is: A. an upsloping straight line.
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The law of increasing opportunity costs is reflected in a production possibilities curve that is concave to the origin.

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3 years ago
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You are given the market demand function Q=2800-1000p, and that each duopoly firm's marginal cost is $0.07 per unit, which impli
Fed [463]

Answer:

q1 = 910

q2 = 910

Explanation:

Given:

Q = 2800 - 1000p

Marginal cost = $0.07 per unit

Q = 2800 - 1000p

p = \frac{2800 - Q}{1000}

p = \frac{2800- q_1 - q_2}{1000}

Let's calculate profit of firm 1:

TR = p1 q1

= \frac{2800 q_1 - q_1^2 - q_1 q_2}{1000}

MR = \frac{2800 - 2q_1 - q_2}{1000}

MR = MC = 0.07

\frac{2800 - 2q_1 - q_2}{1000} = 0.07

Cross multiplying:

2800 - 2q₁ - q₂ = 70

2800 - 2q₁ = 70 + q₂

2800 - 70 - 2q₁ = q₂

2730 - 2q₁ = q₂...............(1)

Let's calculate profit of firm 2:

TR = p₁ q₂

= \frac{2800 q_2 - q_1 - q_2^2}{1000}

\frac{2800 - q_1 - 2q_2}{1000} = MR

MR = MC = 0.07

\frac{2800 - q_1 - 2q_2}{1000} = 0.07

Cross multiplying:

2800 - q₁ - 2q₂ = 70

2800 - 2q₂ = 70 + q₁

2800 - 70 - 2q₂ = q₁

2730 - 2q₂ = q₁................... (2)

Substitute 2730 - 2q₂ for q₁ in (1)...

Thus:

2730 - 2q₁ = q₂

2730 - 2(2730 - 2q₂) = q₂

2730 - 5460 + 4q₂ = q₂

-2730 + 4q₂ = q₂

-2730 = q₂ - 4q₂

-2730 = - 3q₂

q₂ = -2730/-3

q₂ = 910

Substituting 910 for q₂ in (2):

2730 - 2q₂ = q₁

2730 - 2(910)= q₁

2730 - 1820 = q₁

910 = q₁

q₁ = 910

The Cournot equilibrium quantities are: q₁= 910; and q₂ = 910

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3 years ago
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Income and employment.

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