Answer:
A. True
Explanation:
Arbitrage refers to a situation wherein a gain is made owing to price discrepancy or unevenness in two markets. The rule for arbitrage is to buy from the markets where price is less and sell in the markets where price is higher.
Triangular arbitrage occurs wherein 3 different currencies are involved and the exchange rates are not uniform i.e a discrepancy exists and interest rate parity does not hold true.
Interest rate parity refers to the concept wherein the disparity between two currency exchange rates is adjusted by the respective interest rates of the two countries. When interest rate parity exists, no arbitrage is possible as markets are fairly priced.
Answer:
Hence, the annual operating cash flow is: $44860
Explanation:
Year 0 Year 1
Initital investment
Inflows $253,100
variable costs ($140,000)
fixed cost (53800)
Depreciton ($23,200)
Interest expense ($19,500)
Net cash inflows $16600
Tax at 40% ($6640)
Net Cashinflows after tax $9960
Add Depreciation $23,200
Interest net of tax $11.700
Operating cashflows $44860
Hence, the annual operating cash flow is: $44860
Answer:
Minimum selling price is $ 37
Explanation:
Computation of minimum selling price
Direct materials per unit $ 15
Direct labour per unit - existing $ 19
Additional for modification <u>$ 3</u>
Direct Labor per unit <u>$ 22</u>
Variable cost per unit $ 37
Since the Company has sufficient idle capacity to produce the additional order, no incremental fixed manufacturing capacity is considered.
The minimum selling price should be one which covers the variable costs ( modified for labor increase)
The main qualities of
real entrepreneur are:
1) spiritual freedom and
energy;
2) willpower;
3) ability to effectively
negotiate and convince partners and customers;
4) organizational skills;
<span>5) determination and
willingness to situations of risk.</span>
Principal = 1400