We often talk about manufacturing and goods related trade with China. What information can you find on trade in services between the two countries?

A recent survey examined the use of social media platforms. Suppose the survey found that there is a 0.61 probability that a randomly selected person will use Facebook and a 0.28 probability that a randomly selected person will use LinkedIn. In addition, suppose there is a 0.26 probability that a randomly selected person will use both Facebook and LinkedIn.

(a)

What is the probability that a randomly selected person will use Facebook or LinkedIn?

(b)

What is the probability that a randomly selected person will not use either social media platform?

Find the following values, using the equations, and then work the problems using a financial calculator to check your answers. Disregard rounding differences. (Hint: If you are using a financial calculator, you can enter the known values and then press the appropriate key to find the unknown variable. Then, without clearing the TVM register, you can "override" the variable that changes by simply entering a new value for it and then pressing the key for the unknown variable to obtain the second answer. This procedure can be used in parts b and d, and in many other situations, to see how changes in input variables affect the output variable.)

1. An initial $800 compounded for 1 year at 9.9%. Round your answers to the nearest cent.
   $  
   
2. An initial $800 compounded for 2 years at 9.9%. Round your answers to the nearest cent.
   $  
   
3. The present value of $800 due in 1 year at a discount rate of 9.9%. Round your answers to the nearest cent.
   $  
   
4. The present value of $800 due in 2 years at a discount rate of 9.9%. Round your answers to the nearest cent.
   $  

What is the primary difference between the responsibility of a private corporation to its shareholders versus a publicly traded corporation? Explain with examples.

Q2. A high profit margin firm, like Coke requires fewer unit sales, why?

Q3 If a profit appears for some reason under perfect competition, what happens to profit?

Q4. if the imperfect competition power is completely lost, then zero profit would return…then profit is not sustainable..example of firm that this happened to?___.

Answer all the questions, i will give u a thumb!

What is the primary difference in regard to the legal liability of the owners? Explain with examples.

Ms. Higden has been offered yet another incentive scheme. She will receive a bonus of $500,000 if the stock price at the end of the year is $120 or more; otherwise she will receive nothing. (Don’t ask why anyone should want to offer such an arrangement. Maybe there’s some tax angle.)

What combination of options would provide these payoffs? (Hint: You need to buy a large number of options with one exercise price and sell a similar number with a different exercise price.)

Please explain how you find the answer

A & B Enterprises is trying to select the best investment from among two alternatives. Each alternative involves an initial outlay of $100,000. Their cash flows follow:

                YEAR                                    A                                                         B  

                1                                        30,000                                                       0   

                2                                        30,000                                                 25,000

                3                                        30,000                                                 35,000           

                4                                        30,000                                                 45,000

                5                                        30,000                                                 50,000

Evaluate and rank each alternative based on

        a.     payback period

        b.     net present value (use a 10% discount rate) and

        c.     internal rate of return.

Use the option quote information shown below to answer the questions that follow. The stock is currently selling for $36.

a. Suppose you buy 19 contracts of the February 37 call option. How much will you pay, ignoring commissions? (Do not round intermediate calculations.)

Cost           $  

Suppose you buy 19 contracts of the February 37 call option and Macrosoft stock is selling for $39 per share on the expiration date.

b-1. How much is your options investment worth? (Do not round intermediate calculations.)

Payoff           $  

b-2. What if the terminal stock price is $38? (Do not round intermediate calculations.)

Payoff           $  

Suppose you buy 19 contracts of the August 37 put option.

c-1. What is your maximum potential gain? (Do not round intermediate calculations.)

Maximum gain           $  

c-2. On the expiration date, Macrosoft is selling for $32 per share. How much is your options investment worth? (Do not round intermediate calculations.)

Position value           $  

c-3. On the expiration date, Macrosoft is selling for $32 per share. What is your net gain? (Do not round intermediate calculations.)

Net gain           $  

Suppose you sell 19 of the August 37 put contracts.

d-1. What is your net gain or loss if Macrosoft is selling for $33 at expiration? (Input your answer as a positive value. Do not round intermediate calculations.)

(Click to select)  Gain  Loss             $  

d-2. What is your net gain or loss if Macrosoft is selling for $40 at expiration? (Input your answer as a positive value. Do not round intermediate calculations.)

(Click to select)  Gain  Loss             $  

d-3. What is the break-even price, that is, the terminal stock price that results in zero profit? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

Break-even           $

REPLACEMENT ANALYSIS

The Bigbee Bottling Company is contemplating the replacement of one of its bottling machines with a newer and more efficient one. The old machine has a book value of $650,000 and a remaining useful life of 5 years. The firm does not expect to realize any return from scrapping the old machine in 5 years, but it can sell it now to another firm in the industry for $280,000. The old machine is being depreciated by $130,000 per year, using the straight-line method.

The new machine has a purchase price of $1,150,000, an estimated useful life and MACRS class life of 5 years, and an estimated salvage value of $160,000. The applicable depreciation rates are 20%, 32%, 19%, 12%, 11%, and 6%. It is expected to economize on electric power usage, labor, and repair costs, as well as to reduce the number of defective bottles. In total, an annual savings of $250,000 will be realized if the new machine is installed. The company's marginal tax rate is 35%, and it has a 12% WACC.

1. What initial cash outlay is required for the new machine? Round your answer to the nearest dollar. Negative amount should be indicated by a minus sign.
   $
   
2. Calculate the annual depreciation allowances for both machines and compute the change in the annual depreciation expense if the replacement is made. Round your answers to the nearest dollar.

   Year	Depreciation Allowance, New	Depreciation Allowance, Old	Change in Depreciation
   1	$	$	$
   2
   3
   4
   5

3. What are the incremental net cash flows in Years 1 through 5? Round your answers to the nearest dollar.

   Year 1	Year 2	Year 3	Year 4	Year 5
   $	$	$	$	$

4. Should the firm purchase the new machine?

A stock price is currently $50. It is known that at the end of three months, it will be either $55 or $45. The risk-free interest rate is 12% per annum with continuous compounding. What is the value of a three-month European call option with a strike price of $51?

You are celebrating your 22^nd birthday today. You have decided to start investing toward your retirement beginning one month from today. For the first twenty years, you will invest $500 every month. During the next ten years, you will increase your contributions to $900 per month. For the remainder of your working life until you retire at age 67, you plan to invest $1,500 every month. If your investments earn a rate of return of 8.4 percent throughout your working life, how much will be in your retirement account on the day you retire?

1. Below, you will see a pricing curve for Oil Futures. Your client is an oil producer (they are extracting oil from the ground and selling it to refineries)    They wish to hedge their estimated production for March 2021, June 2021, and September 2021.

Oil Pricing Curve

June 2020 $52.35

Sept 2020 $51.00

Dec 2020    $50.05

Mar 2021 $48.10

June 2021 $47.15

Sept 2021    $44.25

1. Oil future prices are said to be in __________.
2. What hedge rates could your client lock into today for Mar21, Jun21, and Sep21?
3. On settlement date for each of the 3 hedges, assume the spot price of oil has dropped to $38.00 per barrel. Show the calculations (2 steps) of the settlement for each of the above three dates. ($38.00/barrel is the price for each of the three dates)