Answer:
the purchase of a foreign asset and a forward contract in the market for foreign exchange.
Explanation:
An arbitrage is a type of trade that is caused as a result of market inefficiency.
For example, if a stock is trading at $50 on the London Stock Exchange (LSE) while it is trading for $52 on the New York Stock Exchange (NYSE) at the same time. Philip buys the stock on the LSE and sells the same shares immediately on the NYSE and earns a profit of $2 per share, this is referred to as an arbitrage.
This ultimately implies that, arbitrage allows an individual to profit from the price difference between similar goods, commodity, securities or currency in different markets.
A covered interest arbitrage can be defined as trading strategy in which an investor minimizes his or her currency risk by using a forward contract to hedge against the interest rate difference between two countries i.e the exchange rate risk. Thus, it's considered to be the most common interest rate arbitrage around the world.
Hence, a covered interest arbitrage involves both the purchase of a foreign asset and a forward contract in the market for foreign exchange.
The financial staff of Cairn Communications has identified the following information for the first year of the roll-out of its new proposed service:
Projected sales $24 million
Operating costs (not including depreciation) $7 million
Depreciation $4 million
Interest expense $3 million
The company faces a 40% tax rate. What is the project's operating cash flow for the first year (t=1)?
Answer:
$11.8 million
Explanation:
Particulars Amount
Sales $24 million
Less: Operating costs $7 million
Less: Depreciation $4 million
EBIT $13 million
Less: Tx at 40% on EBIT $5.2 million
Net income before interest $7.8 million
Add: Depreciation $4 million
Operating cash flow $11.8 million
Assume that Germany and China can produce beer and cloth. If the MPLc/MPLb for Germany is 2/5 and the MPLc/MPLb for China is 1, then Germany should: _______
Answer: c. specialize in producing beer and export beer.
Explanation:
As per the Theory of Competitive Advantage posited by David Ricardo, a country should specialize in the good that it has a competitive advantage in. A country has a competitive advantage if it incurs a less opportunity cost in producing the good.
Opportunity cost of producing beer for Germany = MPLc/MPLb = 2/5
Opportunity cost of producing beer for China = MPLc/MPLb = 1
Germany has a lower cost of producing beer so they should specialize in this and export it.
The balance sheet for Dresser Corporation at December 31, 2020, showed the following subtotals: Current liabilities 145,000 Property, plant and equipment 190,000 Total stockholders’ equity 290,000 Retained earnings 150,000 Total liabilities 220,000 Other long-term assets 150,000 Based on the above data, calculate the following amounts : 1. Current assets 2. Long-term liabilities 3. Contributed capital 4. Total liabilities and stockholders’ equity"
Answer and Explanation:
The computation is shown below;
1. The current asset is
= Total stockholder equity + total liabilities - Property, plant and equipment - Other long-term assets
= $290,000 + $220,000 - $190,000 - $150,000
= $170,000
2. The long term liabilities is
Total liabilities = current liabilities + long term liabilities
$220,000 = $145,000 + long term liabilities
SO, the long term liabilities is
= $220,000 - $145,000
= $75,000
3. The contributed capital is
Total stockholder equity = contributed capital + retained earnings
$290,000 = contributed capital = $150,000
So, the contributed capital is
= $290,000 - $150,000
= $140,000
4. Total liabilities and stockholders’ equity is
= total liabilities + stockholder equity
= $220,000 + $290,000
= $510,000
The San Pedro Company forecasts that total overhead for the current year will be $10,000,000 and that total machine hours will be 200,000 hours. Year to date, the actual overhead is $8,000,000 and the actual machine hours are 100,000 hours. If the company uses a predetermined overhead rate based on machine hours for applying overhead, what is that overhead rate
Answer:
the overhead rate is $50 per machine hour
Explanation:
The computation of the overhead rate is shown below:
Predetermined overhead rate
= Estimated total Overhead ÷ Estimated total machine hour
= $10,000,000 ÷ 200,000 hours
= $50 per machine hour
hence, the overhead rate is $50 per machine hour
The same should be considered and relevant
urrent Attempt in Progress Wildhorse Chemicals management identified the following cash flows as significant in its year-end meeting with analysts: During the year Wildhorse had repaid existing debt of $317,900 and raised additional debt capital of $645,200. It also repurchased stock in the open market for a total of $44,750. What is the net cash provided by financing activities
Answer:
$282,550
Explanation:
Calculation to determine the net cash provided by financing activities
Using this formula
Net cash provided by financing activities= Additional debt capital -Repaid existing debt- Repurchased stock
Let plug in the formula
Net cash provided by financing activities=$645,200-$317,900-$44,750
Net cash provided by financing activities=$282,550
Therefore the net cash provided by financing activities is $282,550
State and explain types of economies?
Answer:
There are three main types of economies: free market, command, and mixed. The chart below compares free-market and command economies; mixed economies are a combination of the two. Individuals and businesses make their own economic decisions.The way scarce resources get distributed within an economy determines the type of economic system. There are four different types of Economic Systems; a traditional economy, a market economy, a command economy, and a mixed economy. Each type of economy has its own strengths and weaknesses.Apr 20, 2020
giá trị của hàng hóa được quyết định bởi đâu?
Answer:
Giá trị của hàng hóa được quyết định bởi: ► Lao động của người sản xuất hàng hóa kết tinh trong hàng hóa. ► Sự hao phí sức óc, bắp thịt, thần kinh của con người. ☺ Lao động trừu tượng của người sản xuất hàng hóa kết tinh trong hàng hóa. ► Quan hệ cung cầu về hàng hóa ở trên thị trường.
Explanation:
Which of the following is not a traditional training method?
A) classroom lectures B) experiential exercises C) videoconferencing D) workbooks
B) Experimental Exercises
Beginning inventory Merchandise $302,000 Finished goods $604,000 Cost of purchases 420,000 Cost of goods manufactured 760,000 Ending inventory Merchandise 202,000 Finished goods 196,000 Compute cost of goods sold for each of these two companies for the year ended December 31, 2017.
Answer:
A. $520,000
B. $1,168,000
Explanation:
Computation to determine the cost of goods sold for each of these two companies for the year ended December 31, 2017.
a. UNIMART Partial income statement
For the year ended December 31,2017
COST OF GOODS SOLD
Beginning merchandise inventory $302,000
Cost of purchase $420,000
Goods available for sale $722,000
Less; Ending merchandise inventory ($202,000)
Cost of goods sold $520,000
b) PRECISION Manufacturing
Partial income statement
For the year ended December 31,2017
COST OF GOODS SOLD
Beginning finished goods inventory $604,000
Cost of manufactured $760,000
Goods available for sale $1,364,000
Less; Ending finished goods inventory ($196,000)
Cost of goods sold $1,168,000
Therefore the cost of goods sold for each of these two companies for the year ended December 31, 2017 will be:
Unimart $520,000
Precision $1,168,000
For a given single sum invested at 8% for four years, how will the future value be affected if the compounding period is changed from quarterly to annually?
Answer:
Future Value will increase
Explanation:
Future Value = Present Value (PV)*(1 + i)^n
Let Amount be $10,000
Interest = 12% compounded annually
Period = 4
Future Value = $10,000 * (1 + 12%)^4
Future Value = $15,735.19
Let Amount be $10,000
Interest = 12% compounded quarterly
Period = 4 (4*4)
Future Value = $10,000*(1 + 3%)^16
Future Value = $16,047.06
Conclusion: The future value will increase.
Holmes, Inc., has offered $215 million cash for all of the common stock in Watson Corporation. Based on recent market information, Watson is worth $193 million as an independent operation. If the merger makes economic sense for Holmes, what is the minimum estimated value of the synergistic benefits from the merger
Answer:
the minimum estimated value of the synergistic benefits from the merger is $22 million
Explanation:
The computation of the minimum estimated value of the synergistic benefits from the merger is given below:
= Holmes Offered value in cash - watson worth
= $215 million - $193 million
= $22 million
Hence, the minimum estimated value of the synergistic benefits from the merger is $22 million
Assume you are Andy Pforzheimer, owner of Barcelona Restaurants, and you are involved in intense conflict with one of your restaurant managers. You realize that the conflict has escalated to the point at which it is no longer functional conflict and you wish to de-escalate it. Which of the following actions should you avoid to help de-escalate the conflict?
a. Stay focused on issues, not emotions
b. Communicate hostility verbally or through body language
c. Reject all requests from the Start
d. Raise your voice to get attention about important points
Answer:
Barcelona Restaurants
Actions to avoid to help de-escalate non-functional conflicts are:
b. Communicate hostility verbally or through body language
c. Reject all requests from the Start
d. Raise your voice to get attention about important points
Explanation:
While functional conflicts are viewed as positive and beneficial to an organization because of the role they play to improve performance, therefore, efforts should be made to de-escalate non-functional workplace conflicts. The efforts should hover around adapting effective communication skills, avoiding immediate reactions, and setting appropriate parameters for acceptable conflicts.
Congratulations! Today is your 20th birthday, but you are starting with nothing in the bank. You just started working full-time, earning $50,000 per year. Your goal is to have $5 million by your 60th birthday (i.e., 40 years from today). Your employer offers a 401(k) plan (contributions by you are tax deductible, growth is tax deferred), and within that plan you choose to invest in an extreme low-cost S&P 500 index mutual fund (like ones offered by Schwab, Fidelity, Vanguard, etc.). The long-term expected return on the S&P 500 index mutual fund is 10% per year. Your employer pays you monthly.
Required:
a. Ignoring taxes, if the employer offers no match on your contributions, how much would you need to save every month to reach your goal?
b. Ignoring taxes, if the employer offers a 10% match on your contributions, how much would you need to save every month on top of your match to reach your goal?
c. Assume your Federal marginal tax rate is 24% and State marginal tax rate is 6%. What is the answer to question (b) on an after-tax basis (i.e., how much do you have to contribute every month after the employer match and net of tax savings)?
Answer:
A) $790.63
B) $718.75
C) $503.13
Explanation:
a. Interest rate = 10%, monthly rate = 10%/12 = 0.10/12
Number of years = 60-20 = 40 years = 40*12 = 480 months
Goal = FV = 5,000,000
The monthly savings needed if employers offers no match =PMT(rate,nper,pv,fv) =PMT(0.10/12,480,0,5000000)
= $790.63
b. If employer offers a 10% match.
Then monthly savings needed
= 790.63/1.10
= 718.75
Monthly savings needed with 10% match by employer
= $718.75
c. Tax savings are 24%+6% = 30%.
So on the contribution of 718.75, you save a 30% tax. So. tax savings = 718.75*0.30 = $ 215.63
So, monthly contribution taking into account tax savings and employer match
= 718.75 -215.62
= $503.13
Q1. What is recruitment? Explain 5 commonly used recruitment sources companies’ use?
Answer:
The top five most popular recruitment sources used by employers include (indicated by percentage of employers): General online job boards and websites (89%) Employee referrals (81%) Staffing agency or third-party recruiter (58%)
Explanation:
choose me to brainlist
Standard and actual costs for direct materials for the manufacture of 1,000 units of product were as follows:
Actual costs 1,550 lbs. at $9.10
Standard costs 1,600 lbs. at $9.00
Determine the (a) quantity variance, (b) price variance, and (c) total direct materials cost variance. Enter favorable variances as negative numbers.
a. Quantity variance $______
b. Price variance $______
c. Total direct materials cost variance
Answer and Explanation:
The computation is shown below;
a.
Materials quantity variance is
= (Actual quantity used × Standard price) - (Standard quantity allowed × Standard Price)]
= (1550 × 9.00) - (1600 × 9.00)
= $(450.00)
= $450 favorable
b.
Direct materials price variance is
Materials Price Variance = (Actual quantity purchased × Actual price) - (Actual quantity purchased × Standard price)
= (1550 × 9.10) - (1550 ×$9.00)
= $155
= $155 unfavorable
c.
Total direct materials cost variance is
= Materials quantity variance + Direct materials price variance
= -$450 + $155
= -$295
= $295 Favorable
Donna Clark has $15,000 that she can deposit into a savings account for five years. Bank A compounds interest annually, Bank B twice a year, and Bank C quarterly. Each bank has a stated interest rate of 5 percent. What account balance would Donna have at the end of the fifth year if she left all the interest paid on the deposit in each bank
Answer:
$19,144.22
$19,201.27
$19,230.56
Explanation:
The formula for calculating future value:
FV = P (1 + r) n
FV = Future value
P = Present value
R = interest rate
N = number of years
Bank A = 15,000(1.05)^5 = $19,144.22
Bank B = 15,000(1.05/2)^10 = $19,201.27
Bank C = 15,000(1.05/4)^20 = $19,230.56
Howard Bowen is a large-scale cotton farmer. The land and machinery he owns has a current market value of $11 million. Bowen owes his local bank $9 million. Last year Bowen sold $10 million worth of cotton. His variable operating costs were $8 million; accounting depreciation was $40,000, although the actual decline in value of Bowen's machinery was $60,000 last year. Bowen paid himself a salary of $50,000, which is not considered part of his variable operating costs. Interest on his bank loan was $400,000. If Bowen worked for another farmer or a local manufacturer, his annual income would be about $30,000. Bowen can invest any funds that would be derived if the farm were sold to earn 10% annually. (Ignore taxes.)
Required:
a. What is Bowen's accounting profit?
b. What is Bowen's economic profit?
Answer:
A. $1,510,000
B. -$10,000
Explanation:
a. Calculation to determine Bowen’s Accounting profits
Using this formula
Accounting profits = Total revenue - Explicit cost
Let plug in the formula
Accounting profit = $10 million - $8 million - $40,000 - $400,000 - $50,000
Accounting profit= $1,510,000
Therefore Bowen’s Accounting profits is $1,510,000
b. Calculation to determine Bowen’s Economic profit
Using this formula
Economic profits = Accounting profit - Implicit cost
Let plug in the formula
Economic profits = $1,510,000 - [($11,000,000*0.1) + $30,000 + ($60,000 - $40,000)]
Economic profits =$1,510,000 - [$1,100,000+ $30,000 + $60,000 - $40,000)]
Economic profits =$1,510,000-$1,150,000
Economic profits =-$10,000
Therefore Bowen’s Economic profit is -$10,000
Materials Variances North Wind manufactures decorative weather vanes that have a standard materials cost of two pounds of raw materials at $1.50 per pound. During September 5,000 pounds of raw materials costing $1.75 per pound were used in making 2,400 weather vanes. Determine the materials price and quantity variance
Answer:
Material price variance = 1250
Quantity variance = 300
Explanation:
Actual price of raw material = $1.75
Standard price = $1.50
Actual quantity = $5000
Material price variance = [Actual price - Standard price] x Actual quantity
Material price variance = [1.75 - 1.50] x 5000
Material price variance = 1250
Quantity variance = [Actual quantity - Standard quantity] x Standard price
Quantity variance = [5000 - 2400 x 2] x 1.50
Quantity variance = 300
Answer:
Material price variance $1,250
Material quantity variance $300
Explanation:
Calculation to determine the materials price and quantity variance
MATERIAL PRICE VARIANCE
Using this formula
Material price variance=(AP-SP)*AQ
Let plug in the formula
Material price variance=($1.75-$1.50)*5,000
Material price variance=$0.25*5,000
Material price variance=$1,250
Therefore Material price variance is $1,250
MATERIAL QUANTITY VARIANCE
Using this formula
Material quantity variance=(AQ-SQ)*SP
Let plug in the formula
Material quantity variance=(5,000-2*2,400)*$1.50
Material quantity variance=(5,000-4,800)*$1.50
Material quantity variance=200*$1.50
Material quantity variance=$300
Therefore Material quantity variance is $300
$100 compounded annually for two years at 3% interest would provide the investor with how much of a return?
a). $6.09
b). $3.03
c). $6.00
d). $3.00
e). None of these
What is divisional structure in organization?
Explanation:
The divisional structure is a type of organizational structure that groups each organizational function into a division. ... Each division contains all the necessary resources and functions within it to support that product line or geography (for example, its own finance, IT, and marketing departments)
Answer:
The divisional structure is a type of organizational structure that groups each organizational function into a division. ... Each division contains all the necessary resources and functions within it to support that product line or geography (for example, its own finance, IT, and marketing departments).
Seemore Company manufactures binoculars. The actual costs for 2013 and 2014 were as follows: 2013 2014 Direct materials: Plastic case $ 8.00 $ 7.60 Lens set 34.00 34.40 Direct labor 64.00 (1.6 hours) 60.00 (1.5 hours) Indirect manufacturing costs: Variable 16.00 14.20 Fixed 4.00 (100,000 units) 3.80 (120,000 units) Beginning in 2014, Seemore implemented a continuous improvement program that required a first-year cost reduction target of a 7 percent reduction of the 2013 base. Seemore's continuous improvement target for direct labor in 2014 was:
Answer:
$7.07
Explanation:
Calculation to determine what Seemore's continuous improvement target for direct labor in 2014 was:
2014 Continuous improvement target for direct labor=$ 7.60 – ($ 7.60 × 0.07)
2014 Continuous improvement target for direct labor=$ 7.60 -$0.532
2014 Continuous improvement target for direct labor= $7.07
Therefore Seemore's continuous improvement target for direct labor in 2014 was: $7.07
The Bert Corp. and Ernie, Inc., have both announced IPOs. You place an order for 1,150 shares of each IPO. One of the IPOs is underpriced by $18.00 and the other is overpriced by $6.50. You will receive all of the shares you ordered of the overpriced IPO, but only one-half of the shares you ordered of the underpriced IPO. What profit do you expect?
a. $31,875.00.
b. $11,562.50.
c. $14,375.00.
d. $7,552.00.
e. $2,812.50.
Answer:
The Bert Corp. and Ernie, Inc.
The profit expected is:
= $2,875.
Explanation:
a) Data and Calculations:
The Bert Corp. Ernie, Inc.
IPO order placed 1,150 shares 1,150 shares
Underpriced by $18.00
Overpriced by $6.50
Profited expected $10,350 -$7,475
Net profit = $2,875 ($10,350 - $7,475)
b) The profit expected is generated from the underpriced stock. This profit is reduced by the increased cost incurred on the over-priced stock. Therefore, the net profit is the difference between the profit and the additional cost incurred.
Oregon Forest Products will acquire new equipment that falls under the five-year MACRS category. The cost is $500,000. If the equipment is purchased, the following earnings before depreciation and taxes will be generated for the next six years. Use Table and calculate your final answer using the formula and financial calculator methods.
Earnings before Depreciation
Year 1 $160,000
Year 2 215,000
Year 3 125,000
Year 4 89,000
Year 5 78,000
Year 6 44,000
The firm is in a 20 percent tax bracket and has a 12 percent cost of capital. Calculate the net present value.
Explanation:
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Answer:
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b/ The number of years required before the capital stock exceeds $200 000.
Rosalia White will invest $3,000 in an IRA for the next 30 years starting at the end of this year. The investment will earn 13 percent annually. How much will she have at the end of 30 years
Answer:
$879,597.65
Explanation:
The future value of an ordinary annuity formula is applicable in this case, since an ordinary annuity is such that payments into the accounts are expected to occur at the end of the periods rather than at the beginning of each year:
FV=yearly payment*(1+r)^n-1/r
yearly payment=$3,000
r=13%
n=number of annual payments =30
FV=$3000*(1+13%)^30-1/13%
FV=$3000*(1.13)^30-1/0.13
FV=$3000*(39.11589796-1)/0.13
FV=$3000*38.11589796/0.13
FV=$879,597.65
A tractor acquired at a cost of $420,000 has an estimated residual value of $30,000, has an estimated useful life of 25,000 hours, and was operated 1,850 hours during the year. Determine the following. If required, round your answer for the depreciation rate to two decimal places. (a) The depreciable cost $fill in the blank 1 (b) The depreciation rate $fill in the blank 2 per hour (c) The units-of-output depreciation for the year
Answer:
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Answer:
Currently, the income statement for company reflects a total period cost for depreciation of $7,876,000
Discuss FOUR ways in which SAA could benefit from proper long-term planning.
Answer:
Explanation:
Planning is a core and fundamental step which should be done before embarking in a process, business or task. It could be used to project a short or long term engagement or task.
The benefits of long term planning could include :
Business having a long term plan shows a proactive sense of approach, that is it shows that the business has a blue print, a target and a defined goal which is being laid down in sequence, this ensures that they will have very few chances of making rash decisions due to market fluctuation or growth as d they are less proned to having a reactive agenda.
Similarly, With a laid down long term plan, this shows that there is a guide, a path, a set and defined target which the company aims to achieve with patience and tact. Thus ensures that the business has a well defined direction.
Also, It improves efficiency, the fact that developments to be made at each point or time has long been defined, then there is a dequate preparedness towards such target which in turn improves.
Long term strategic planning will ultimately lead to company's growth and drive profit due to sustained existence in the market and well guided and structure long term planning , leading to increased popularity and revenue drive.
Biden Resorts Company currently has 0.2 million common shares of stock outstanding and the stock has a beta of 2.2. It also has $1 million face value of bonds that have five years remaining to maturity and 8 percent coupon with semi-annual payments, and are priced to yield 13.65 percent. If Biden issues up to $2.5 million of new bonds, the bonds will be priced at par and have a yield of 13.65 percent; if it issues bonds beyond $2.5 million, the expected yield on the entire issuance will be 16 percent. Biden has learned that it can issue new common stock at $10 a share. The current
risk-free rate of interest is 3 percent and the expected market return is 10 percent. Biden's marginal tax rate is 30 percent. If Biden raises $7.5 million of new capital while maintaining the same debtto-equity ratio, its weighted average cost of capital is?
Answer:
Hence, the weighted average cost of capital is 15.87%.
Explanation:
We have to find current weights,
Value of equity = Shares x Share price = 0.2 x 10 = $2 million
Face Value of Bonds FV = $1 million
Semi annual coupon P = 1 x 8% / 2 = $0.04 million
Number of coupons remaining n = 5 x 2 = 10
Semi annual yield r = 13.65% / 2 = 6.825%
Value of Debt = Px [1 - (1 + r)-n] / r + FV / (1 + r)n
= 0.04 x [1 - (1 + 0.06825)-10] / 0.06825 + 1 / (1 + 0.06825)10
= $0.8 million
Total Value = 2 + 0.8 = $2.8 million
Weight of Debt = 0.8 / 2.8 = 28.57%
Weight of Equity = 2 / 2.8 = 71.45%
Amount of Debt to be raised = Weight of debt x Capital
= 0.2857 x 7.5
= $2.14 million
Since the amount of debt to be raised is less than $2.5 million, the yield will be 13.65%
Cost of Equity = Risk Free Rate + Beta x (Market Return - Risk Free Rate)
= 3% + 2.2 x (10 - 3)
= 18.4%
The weighted average cost of capital:-
WACC = Weight of Debt x Cost of Debt x (1 -Tax Rate) + Weight of Equity x Cost of Equity
= 0.2857 x 13.65% x (1 - 0.3) + 0.7145 x 18.4%
= 15.87%
Suppose the population of a country is 1.1 million and the labor force is 800,000. 760,000 are employed. Assume that full-employment occurs at a 4 percent unemployment rate at a real GDP level of $100 billion. Based on the information above, what is the unemployment rate
Answer: 5%
Explanation:
Unemployment rate = Number unemployed / Labor force * 100%
The number of people who are unemployed are:
= Labor force - Employed people
= 800,000 - 760,000
= 40,000 people
Unemployment rate = 40,000 / 800,000 * 100%
= 5%
what the term economic environment means
Answer:
gracias por los puntosdssss
Answer:
All external economic factors that influence consumers(buyer) and businesses, affect the performance of companies.
Explanation:
When President Obama was president he had discussed raising income taxes for individuals earning over $250,000 in income. Explain how these higher income taxes will affect the aggregate demand curve. What variables cause the short-run aggregate supply curve to shift
Answer:
A) Higher income taxes will cause a decrease in disposable income and this will affect personal expenditure which will cause the aggregate demand curve to shift leftwards ( decrease in price level and real GDP )
B)
i) Change in input price
ii) Change in production cost
iii) Increase in labor supply or increase in capital stocks
Explanation:
A) Effects of higher income taxes on aggregate demand curve
i) Higher income taxes will cause a decrease in disposable income and this will affect personal expenditure which will cause the aggregate demand curve to shift leftwards ( decrease in price level and real GDP )
B) The factors that will cause the short-run aggregate supply curve to shift
a) Change in input price
b) Change in production cost
c) Increase in labor supply or increase in capital stocks