Q: Who uses the original base period for the CPI index?Give an example?
A: CPI is the abbreviation used for the consumer price index. The combined weighted average value of…
Q: The FW of the Alternative 1 is $ (Round to the nearest dollar.) The FW of the Alternative 2 is S.…
A: Future Worth: It is the future value of the annual cash flows of the project. These cash flows…
Q: When calculating the present worth of a uniform series using the relationship P = A(P|A, i%,n), the…
A: P equals to A times the factor of P over A and this factor known as the Uniform Series of Present…
Q: How can we calculate the Times-Interest-Earned Ratio?
A: Times Interest Earned Ratio: It is one of the solvency ratios. It is a measure to evaluate the net…
Q: Calculate the accounting rate of return of the new sign. Accounting rate of return %
A: Accounting Rate of Return The accounting rate of return (ARR) formula is helpful in determining the…
Q: a. what is the difference between the discount rate used for net present value and the internal rate…
A: Discount rate used for net present value is rate which investor want to earn from a project . It is…
Q: Nhat is the exact rate of return?
A: The net gain or net loss of an investment over a predetermined time period is referred to as a rate…
Q: s. What is the geometric average return for this time period?
A: Geometric Average: It is the average return for a set of values computed with the products of the…
Q: Nominal values are measured in ________ and real values take account of
A: Given Nominal values are measured ? Real values taken account of?
Q: For the following interest rate and cash flows what are the NPV and EAUC? Please use excel to answer…
A: We need to compute NPV (Net present value) and EUAC (Equivalent uniform annual cost) using excel.
Q: Present using the rate of return method (ROR) with the formula. If the NPV is used to determine the…
A: Here, Net Cash Flow is 31250 Rate of Interest is 10% Initial Investment is 100000 NPV is 18462…
Q: What is the internal rate of return? (Do not round intermediate calculations. Enter your answer as a…
A: Internal Rate of Return: It is the rate that makes the project/investment net present value equal…
Q: In performing horizontal analysis, why is it important to look at both the amount and the percentage…
A: Definition: Horizontal analysis: The comparison of an item of a financial statement of one year…
Q: The difference between gini coefficient of market income and gini coefficient of disposable income…
A: The difference between gini coefficient of market income and gini coefficient of disposable income…
Q: Describe the Mixed-Dollar Analysis?
A: Mixed-Dollar Analysis is commonly known as a currency basket that consists of different currencies…
Q: The price index used to measure inflation is a a. Simple average of its components b. Stratified…
A: Simple average is calculated as the sum of all observations divided by the number of observations.…
Q: Which of the following statements is true about the present value factors? The present value factor…
A: Present value interest factor is used to determine the present value of series of future annuities.…
Q: Please explain the difference between the terms interest rate and required return by defining each.
A: The amount which is charged by the lender to the borrower in order the use assets is known as the…
Q: 29.The calculations of a discount rate can be based on all the following approaches among others…
A:
Q: the natural
A: The Phillips curve displays the inverse relationship between unemployment and inflation: as…
Q: Write the discounting formula for the Conversion from Actual to Constant Dollars?
A: Introduction Inflation is a major reason for conversion of actual value to Constant Dollar value.…
Q: Logan is conducting an economic evaluation under inflation using the then-current approach. If the…
A: The nominal rate of return is calculated to ascertain the actual return on investment considering…
Q: What will be the Net interest income variation for the cumulative GAP, if interest rates have a 1%…
A: The potential loss from unexpected changes in interest rates can significantly alter a bank’s…
Q: The internal rate of return (IRR) is the discount rate that results in a net present value (NPV) of…
A: According to rule, because you have posted multiple questions, we will answer the First question…
Q: The break-even value calculation is similar to the calculation we use for theinternal rate of…
A: The internal rate of return (IRR) is a capital budgeting metric used to gauge the benefit of…
Q: How do you turn an income statement int a forecasted return? And how is it helpful?
A: Return means earn additional on invested amount. Return is a positive factor in every investment.…
Q: The present equivalent value is S (Round to the nearest cent.)
A: When future value is discounted with rate of interest over a period of time, it gives present value.…
Q: Give an example assuming that the Compounding Period equals to Payment Period?
A: The representation on the basis of assumption:
Q: Label each of the following statements as either true (“T”) or false (“F”). An out-of-pocket cost…
A: Relevant costs: These costs can be defined as the costs that can be avoided if we choose over option…
Q: Describe the advantages of the dollar-value LIFO method.
A: Definition: Dollar value LIFO method: In this method, the valuation of inventory is calculated on…
Q: is this rounded to the nearest cent ?
A: The amount of each deposit is $1,250. The compounding frequency is quarterly. The interest rate is…
Q: Give an example on annual rate of return method
A:
Q: Select all of the time value of money factors that are known in a NPV assessment O Present value of…
A: npv : IT IS THE DIFFERENCE BETWEEN PRESENT VALUE OF CASH INFLOW AND PRESENT VALUE OF CASHOUTFLOW.
Q: Calculate the Payback period, Accounting Rate of Return and the Net Present Value (using a 17%…
A: Given:
Q: Provide a descriptive formula for each of the following (e.g., Total risk =?+?): a. Total risk=…
A:
Q: Is a cap rate the same as an IRR? Which is generally greater? Why?
A: The capitalization rate or cap rate cant be considered as similar to the IRR or the internal rate of…
Q: Calculate the payback period.(using a 17% discount factor) and a fair approximation range of the…
A: Given:
Q: In an inflationary period, what is the difference between (a) inflated dollars and “then-current”…
A: Inflation is the rate at which goods and services cost rates increment. On the off chance that…
Q: For the below cash flows: (a) Determine the number of positive roots to the rate of return relation…
A: Note that the first and last values are negative so there are two sign changes, from EOY 0 to EOY 1…
Q: What Is the term Actual-Dollar Analysis?
A: Dollar analysis is referred as the analysis of dollars by businesses and companies to compare the…
Q: Define dollar-value LIFO (DVL) and explain its advantages.
A: Dollar-value LIFO is an accounting method used for inventory that follows the last-in-first-out…
Q: Define each term and state three characteristics for each term a- Pay-back period b- Discounted…
A: a. Pay-back period: The payback period is the length of time required to repay the cost of an…
Q: In computing the WACC, what is the difference between using the current market value weights rather…
A: WACC A computation of an entity’s cost of capital in which every capital’s category is apportioned…
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- FOREIGN INVESTMENT ANALYSIS After all foreign and U.S. taxes, a U.S. corporation expects to receive 2 pounds of dividends per share from a British subsidiary this year. The exchange rate at the end of the year is expected to be 1.53 per pound, and the pound is expected to depreciate 5% against the dollar each year for an indefinite period. The dividend (in pounds) is exported to grow at 10% a year indefinitely. The parent U.S. corporation owns 10 million shares of the subsidiary. What is the present value in dollars of its equity ownership of the subsidiary? Assume a cost of equity capital of 11% for the subsidiary.Problem 31-5 Cross-Rates and Arbitrage Suppose the Japanese yen exchange rate is ¥75 = $1, and the British pound exchange rate is £1 = $1.60. a. What is the cross-rate in terms of yen per pound? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. Suppose the cross-rate is ¥125 = £1. What is the arbitrage profit per dollar used? (Do not round intermediate calculations and round your answer to 4 decimal places, e.g., 32.1616.)25-A UK trader imported goods from US for $ 50,000 and the spot rate GBP 0.500 = 1 USD. The UK importer expected that GBP may appreciate by 4% after 30 days. What will be the new exchange rate after thirty days for 1 GBP? (consider the first 4 decimals to select the correct answer) a. None of the options b. USD 2.0833/GBP c. GBP 0.4900/USD d. USD 0.5000/GBP
- Q1. Analytical Question: China Eastern, headquartered in Shanghai, needs US $5,000,000 for one year to finance working capital. The airline has two alternatives for borrowing: a. Borrow US$5,000,000 in eurodollars in London at 7.25% per annum. b. Borrow HK $39,000,000 in Hong Kong at 7.00% per annum, and exchange these Hong Kong dollars at the present exchange rate of HK$7.8/US$ for U.S. dollars. At what ending exchange rate would China Eastern be indifferent between borrowing U.S. dollars and borrowing Hong Kong dollars? Show your calculation and discuss.Q.1 a) Perth International Co., an Australian multinational company, forecasts 70 million Australian dollars (A$) earnings next year (i.e., year-one). It expects 50 million Chinese yuan (CNY), 49 million Indian rupees (INR) and 33 million Malaysian ringgit (MYR) proceeds of its three subsidiaries in year-one. It also forecasts the year-one exchange rates A$0.3791/CNY, A$0.0420/INR and A$0.6130/MYR. Calculate the total Australian dollar (A$) cash flow for year-one. (enter the whole number with no sign or symbol) b) Perth International anticipates a 4.38 per cent increase in the year-one income of its subsidiaries in year-two. It has information that the current 5.25 per cent, 8.34 per cent, 13.71 per cent and 10.86 per cent nominal interest rate in Australia, China, India and Malaysia, respectively, will remain the same in the next three years. Due to foreign currency higher nominal interest rate, subsidiaries will invest 26 per cent, 50 per cent and 40 per cent of their year-two…Quantitative Problem 1: Suppose that 1 Swedish krona could be purchased in the foreign exchange market today for $0.13. If the krona appreciated 9% tomorrow against the dollar, how many kronas would a dollar buy tomorrow? Do not round intermediate calculations. Round your answer to two decimal places. ____ kronas Quantitative Problem 2: Suppose the exchange rate between the U.S. dollar and the South African rand was 14 rand = $1 and the exchange rate between the U.S. dollar and the Israeli shekel was 1 shekel = $0.29. What was the exchange rate between the South African rand and the Israeli shekel? Do not round intermediate calculations. Round your answer to two decimal places. ______ rands per shekel Quantitative Problem: Assume that interest rate parity holds. In the spot market 1 Japanese yen = $0.008, while in the 180-day forward market 1 Japanese yen = $0.0088. 180-day risk-free securities yield 1.05% in Japan. What is the yield on 180-day risk-free securities in the United…
- 16. Assume that the export price of a Toyota Corolla from Osaka, Japan is ¥2,150,000. The exchange rate is ¥294/OMR. The forecast rate of inflation in the Oman is 2.2% per year and is 0.0% per year in Japan. Use this data to answer the following questions on exchange rate pass–through. a. What was the export price for the Corolla at the beginning of the year expressed in Omani Rials? b. Assuming purchasing power parity holds, what should the exchange rate be at the end of the year? c. Assuming 100% pass–through of exchange rate, what will be the dollar price of a Corolla at the end of the year?5. A U.S. firm expects a receivable (cash inflow) of €1,000,000 in six months. The current exchange rate is $1.125/€. Firm wants to sell euros in six months (to convert the inflow into dollars). Consider 3 possible spot prices in six months. 1. $1.195/€ 2. $1.100/€ 3. $1.025/€ What kind of option, put or call, is appropriate to hedge with? In each scenario, what is the total amount of the firm's NET receivable? NET receivable implies you should consider the receivable as well as the hedging costs of buying the option. (Assume an option exercise price of $1.130/€ and option premium of $.016/€) | 1. 2. 3.Problem 31-4 Using Spot and Forward Exchange Rates Suppose the spot exchange rate for the Canadian dollar is Can$1.07 and the six-month forward rate is Can$1.09. a. Which is worth more, a U.S. dollar or a Canadian dollar? multiple choice 1 U.S. dollar Canadian dollar b. Assuming absolute PPP holds, what is the cost in the United States of an Elkhead beer if the price in Canada is Can$2.99? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. Is the U.S. dollar selling at a premium or a discount relative to the Canadian dollar? multiple choice 2 discount premium d. Which currency is expected to appreciate in value? multiple choice 3 Canadian dollar U.S. dollar e. Which country do you think has higher interest rates—the United States or Canada? multiple choice 4 Canada the United States
- 35-The exchange rates for USD, JPY (Japanese Yen) and OMR are as follows, USD 16.0000/OMR, JPY 0.1600/USD. Which one of the following is the cross rate for JPY/OMR? If we exchange OMR 20,000, how much JPY we will get? O a. JPR 2.65/OMR and JPY 1,250 O b. None of the options O c. JPR 2.56/OMR and JPY 51,200 O d. JPR 2.62/OMR and OMR 125,000Question 01 Dell (US Company) is evaluating the proposal of a new Keyboard and computer accessories factory in an overseas country (Germany). The currency in the overseas country is Euro. The risk-free rate in the United States is 5 percent. Dell will be renting a premise of 50,000 Square feet for this facility. Annually the factory expects to sell 20,000 units of Keyboard at 3 per keyboard. Currently, the Euro and USD have an exchange rate of €1/$2. The total capital cost is 1.5 million USD and is depreciated using the straight-line method over three years to a zero-salvage value. Dell’s discount rate is 10%, and its home currency is USD. Assume; initially, Dell will require .1 million Euros in working capital for this project. However, after the project, Dell will not receive anything from the working capital. In Germany, the CFFA will be 0.9 million euros in the first year, followed by 1 million euros in the second year. The inflation rate in the United States is 8%, and the…Suppose a U.S. investor wishes to invest in a British firm currently selling for £60 per share. The investor has $6,000 to invest, and the current exchange rate is $2/£. Suppose now the investor also sells forward £3,000 at a forward exchange rate of $2.10/£. Calculate the dollar-denominated returns for each scenario. (Round your answers to 2 decimal places. Negative amounts should be indicated by a minus sign.)