Answer:
X=97.24
Explanation:
PV = Present Value = X+2000 by the 16th years
PMT = Payments = $100
FV = Future Value = 2000 at the end of 16 years
n= number of years
Applying the equation of future value for annuity
FV = pmt* ((1+r)ⁿ - 1
)/r
Inputting the values;
2000=100*((1+r)¹⁶-1)/r
Solving for r, gives r = 2.9%
Therefore using the formula for PV for annuity;
PV=PMT*(1-(1/1+r)/r)
X=100*(1-(1/1.029)/0.029
X=100*((1-0.9718)/0.029)
X=100*(0.0282/0.029)
X=97.24
Answer:
The correct answer is (B) Buy euro at $1.50/€, buy £ at €1.25/£, sell £ at $2/£
Explanation:
The dollar- euro exchange rate is quoted as $1.50 = €1.00
the dollar-pound exchange rate is quoted at $2.00 = £1.00
To calculate the actual cross rate we use; S(euro divided by pounds) = S(dollar/pounds) ÷ S(dollar/euro).
Using symbols to denote this, we have S(€/£) = S($/£) / S($/€)
S(€/£) = S(2/1) ÷ S(1.50/1)
= (2 / 1.5)
= €1.33.
Consequently, from this result we now know that the euro is undervalued with respect to pounds under the cross rate being offered by the bank. This implies that you should first buy the euro, convert to pounds, and eventually convert back to dollars, this would enable you make money as an investor.
Explanation:
A transformational leader is the one that identifies where changes are needed and guide this change by motivating and inspiring the group, <em>changing expectations and perceptions in order to achieve a common goal, this common goal is the reason why they enphasize empowerment.</em>
I hope you find this information useful and interesting! Good luck!
Answer:
The company pass from monopoly to a competitive market.
The new companies increase the supply and therefore, the equilibrium price decreases.
Explanation:
The approval of new cable companies generates an increase in the supply. As the suply shift to the right the quantity (people wiht a monthly cable service) will increase and the price (monthly fee) decrease.
Harvey's Company is already starting to decrease his price to do an effort to retain his customer. This company is no longer a monopoly so it will decrease price to be more competitive.
Answer: Macaulay Duration = 2.6908154485 = 2.69
Explanation:
Macaulay Duration = Sum of Cash flows Present Value/ current bond price
Cash flows: year 1 = $12
Cash flows: year 2 = 12
Cash flows: year 3 = 100 + 12 = 112
Sum of Cash Flow PV = (1×12÷ (1.118)^1) + (2×12÷ (1.118)^2) +(3×112÷(1.118)^3)
Sum of Cash Flow PV = 270.37857712
Current Bond Price or Value = Face Value/ (1+r)^n + PV of Annuity
Current Bond Price or Value = 1000/ (1.118)^3 + (30×(1 - (1+0.118)^-3)/0.118
Current Bond Price or Value = 100.48202201
Macaulay Duration = 270.37857712 ÷ 100.48202201
Macaulay Duration = 2.6908154485 = 2.69
