The real exchange rate ( RER ) is the ratio of the price level abroad and the domestic price level.
RER = ( Nominal Exchange Rate x Foreign Price ) / ( Domestic Price )
The price of sofa is 2,400 pesos in Argentina and the nominal exchange rate is 4 pesos per dollar ( 2,400 : 4 = $600 )
RER = 4 x $600 / $800 = 3
Answer: The Real Exchange Rate is 3 pesos per dollar.
Answer:
The correct option is C
Explanation:
Secondary data is the kind of data, where the data or the information is collected through or using someone other than the user. And the sources of the secondary data are or involve information as well as censuses collected through organizational records, departments of government and data or information which originally collected from other research purposes.
This data has potential problems which is that it might not be so relevant, the data is not current or updated and also might not be impartial.
Answer:
The correct answer is option B.
Explanation:
The main difference between technological efficiency and economic efficiency is that technological efficiency is concerned with the quantity of outputs used while economic efficiency is concerned with the value of inputs used.
Technological efficiency implies that a firm is producing a level of input using the least possible quantity of inputs. Economic efficiency occurs when a firm is able to produce a level of output at the least possible cost.
Technological efficiency does not require economic efficiency but economic efficiency require technological efficiency.
The company's external equity comes from those funds raised from public issuance of shares or rights. The cost of external equity is the minimum rate of return which the shareholders supply new funds <span>by </span>purchasing<span> new shares to prevent the decline of the market value of the shares. To compute the cost of external equity, we should use this formula:</span>
Ke<span> = (DIV 1 / Po) + g</span>
Ke<span> = cost of external equity</span>
DIV 1 = dividend to be paid next year
Po = market price of share
g = growth rate
In the problem, the estimated dividend to be paid next year is $1.50. The market price is $18.50 and the growth rate is 4%.
<span>Substituting the given to the formulas, we need to divide $1.50 by $18.50 giving us the result of 8.11% plus the growth rate; this would yield to the result of 12.11% cost of external equity.</span>
Answer:
The transaction costs associated with this exchange are $155
Explanation:
The computation of the transaction cost which is associated with this exchange is shown below:
= Ad charges in the newspaper + law firm write up charges
= $60 + $95
= $155
It includes various cost like - transportation cost, legal fees, communication charges, etc.
The installation of Beth's new roof is not considered in the computation part because it is not an exchange transaction cost. So, this cost is ignored.
