2. Explain how each of the following factors may affect LRAS and SRAS respectively.In particular, explain whether and in which direction each of the building blocks ofLRAS and SRASS – viz., labor supply (N*), labor demand (Nd), capital supply(K*), capital demand (K“), and the production function – as well as the aggregatesupply (AS) curves themselves may shift in response to the changes below.(a) A rise in the labor force participation rate (LFPR).

Given: Let us determine an increase in the rate of labor force participation (LFPR).

Answered: 2. Explain how each of the following…

Advanced Engineering Mathematics

10th Edition

ISBN:9780470458365

Author:Erwin Kreyszig

Publisher:Erwin Kreyszig

Chapter2: Second-order Linear Odes

Section: Chapter Questions

Problem 1RQ

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Use the basic equation for the capital asset pricing model (CAPM) to Find the risk-free rate for a firm with a required return of 15% and a beta of 1.25 when the market return is 14%
Does this have a relative minimum or maximum at the given point?
A manufacturing firm, Caleb Corp, produces and sells product in its home (US) market, and in a foreign market. There is inherent risk in the revenues collected from the foreign market due to volatility in the exchange rate. Under a benchmark strategy, all of the production takes place in the home country. The resulting expected profits for Caleb Corp are variable, due to variation in the exchange rate. As an approximation, the firm has estimated profits for five possible ranges of the exchange rate, with profit represented as a lottery, L= (.2, 150; .2, 200; .3, 220; .2,250; .1, 270) The probabilities are estimated probabilities for the different ranges. The outcomes in this lottery are the estimated final profit levels (not changes in profit). (a) Calculate the expected profit if the firm follows this benchmark strategy, i.e., E(L)
A manufacturing firm, Caleb Corp, produces and sells product in its home (US) market, and in a foreign market. There is inherent risk in the revenues collected from the foreign market due to volatility in the exchange rate. Under a benchmark strategy, all of the production takes place in the home country. The resulting expected profits for Caleb Corp are variable, due to variation in the exchange rate. As an approximation, the firm has estimated profits for five possible ranges of the exchange rate, with profit represented as a lottery, L= (.2, 150; .2, 200; .3, 220; .2,250; .1, 270) The probabilities are estimated probabilities for the different ranges. The outcomes in this lottery are the estimated final profit levels (not changes in profit). Now suppose the firm can also buy forward contracts on foreign currency to neutralize the effect of the exchange rate on profits. Assume that these provide complete hedging, but that it involves an additional cost, so that following the…
A manufacturer wants to optimize its shipment of goods to its customers. To minimize their turnover time and avoid building up stocks that add costs, the wholesaler wants to know if weather conditions are important in determining the type of shoe demanded. Specifically, he would like to know if high temperatures affect the sale of closed, rubber-heeled walking shoes. He the data showing the temperature recorded at the location of its retail shops, as well as their record of sales of goods, during each day of the past year. What type of analysis should he conduct? What variables should be considered? Explain.
Suppose a study wants to predict the market price of a certain species of turtle (Y) based on the following independent variables indicated in the table. Based from the table, what is the equation of the multiple linear regression? (Round off up to two decimal places. Market Price = 0.07 - 0.40*weight + 1.51*length + 1.41*width + 0.80*age Market Price = - 0.40*weight + 1.51*length + 1.41*width + 0.80*age Market Price = 0.07 + 0.40*weight + 1.51*length + 1.41*width + 0.80*age Market Price = 0.07 - 0.40 + weight + 1.51 + length + 1.41 + width + 0.80 + age
A shoe wholesaler wants to optimize its shipment of shoes to its client retailers. To minimize their turnover time and avoid building up stocks that add costs, the wholesaler wants to know if weather conditions are important in determining the type of shoe demanded. Specifically, she / he would like to know if high temperatures affect the sale of closed, rubber-heeled walking shoes. He / she has the relevant data showing the temperature recorded at the location of its retail shops, as well as their record of sales of these walking shoes, during each day of the past year. What type of analysis should he / she conduct? What variables should be considered? Explain.
Compute the forecasted values for Yt for July and August in 2020 by using the modelsstated in (c) and (d)
Table 1 HPF Demand in the last 12 periods Period Month Demand in '000 Period Month Demand in '000 1 January 37 7 July 43 2 February 40 8 August 47 3 March 41 9 September 56 4 April 37 10 October 52 5 May 45 11 November 55 6 June 50 12 December 54 The manager of the company wants to be certain enough OFC01 are available to complete orders promptly and they have adequate inventory in stock. During the last meeting, a number of forecast techniques have been discussed: Simple moving average n = 4 Weighted moving average with n=4 with the following weights from most recent periods: 0.4, 0.3, 0.2, 0.1 Exponential Smoothing with alpha = 0.2 Linear trend The manager would like to ascertain the best tools that he and his team can effectively manage the production processes. Among the above forecasting methods, which method should be used to forecast the demand for this product? Why? The…
Two pumps capable of delivering 100 hp to an agricultural application are being evaluated in a present economy study. The selected pump will only be utilized for one year, and it will have no market value at the end of the year. Pertinent data are summarized as given follows. If electric power costs $0.10 per kWh and the pump will be operated 4,000 hours per year, which pump should be chosen? Recall that 1 hp = 0.746 kW.
Hamed own a local gold market that currently has 4693401 subscriber in Instagram at a quarterly charge ofR.O. 18. He notices that if he raises the price of his commodity to R.O. (18 + 4), he will lose 8549 subscriber.Assuming that subscriptions are linearly related to the price, what price should Hamed charge for aquarterly subscription to maximize his revenue?
Suppose that the index model for two Canadian stocks HD and ML is estimated with the following results: RHD =-0.03+2.10RM+eHD R-squared =0.7 RML =0.06+1.60RM+eML R-squared =0.6 σM =0.15 where M is S&P/TSX Comp Index and RX is the excess return of stock X. For portfolio P with investment proportion of 0.4 in HD and 0.6 in ML, calculate the systematic risk, non-systematic risk, and total risk of P.

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