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Answer:
Short the futures contract; Borrow at the risk-free rate; Long corn;
Explanation:
Spot rate = $3.20
Therefore implied future rate = spot x ert
Therefore implied future rate = 3.20 x e0.05 x 6/12
Therefore implied future rate = 3.20 x 1.025315
Therefore implied future rate = 3.281
Since implied future rate < future rate, we will short future contract and borrow and buy at spot
Therefore, 1st choice is correct
Answer: A. The answer cannot be ascertained without additional information.
Explanation:
There are different reasons that could explain why the price of the HP Printers would reduce abroad but not in this country. HP could be producing computers abroad for instance and this country charges import duties when HP imports but import duties are not charged abroad.
There also could be a difference in currency value and standard of living influencing how HP prices its goods abroad as well as other factors. More details would therefore be needed to answer this question.
Collusion arises when firms act together to reduce output and keep prices high.
<h3>Collusion</h3>
Collusion occurs when entities or individuals work together to influence a market or pricing for their own advantage. Antitrust and whistleblower laws help to deter collusion.
Collusion occurs when oligopoly firms make joint decisions, and act as if they were a single firm. Collusion requires an agreement, either explicit or implicit, between cooperating firms to restrict output and achieve the monopoly price.
<h3>Types of collusion</h3>
- Formal collusion – when firms make formal agreement to stick to high prices. This can involve the creation of a cartel.
- Tacit collusion – where firms make informal agreements or collude without actually speaking to their rivals.
- Price leadership.
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Answer:
It implies that the economy is in recession. Less than full employment equilibrium is a macroeconomic term used to describe a situation where an economy's short-run real gross domestic product (GDP) is lower than that same economy's long-run potential real GDP