Assume that you use Purchasing Power Parity (PPP) to forecast exchange rates. Suppose you expect that inflation in the UK the next year will be 1.0%, and inflation in the US will be 5.0%. Assume that you are considering the purchase of five one-year British pound call options from PHLX with a strike price of $1.265/£. The premium is $0.014 per £. The spot rate of the pound is $1.25/£ and the one-year forward rate is $1.26/£ today.

1. Based on your PPP analysis, what will be your expected spot exchange of $/£ in one year?

2. Graph the call option cash flow schedule at maturity. Mark option’s strike price and break-even point.

c. Determine your expected profit (or loss) if the pound appreciates to your expected future spot rate.

d. Determine your expected profit (or loss) if the pound appreciates to the forward rate.

As 90% of the US population is under some form of shut- or lock-down, the economic consequences have been devastating: 10 million unemployment claims in two weeks, expectation of a Q2 GDP decrease of over 25%, etc. The same is true in other countries with very few exceptions. While big business will probably recover, the impact on small businesses is both uncertain and possibly permanent – a study in the UK estimates that a six month shutdown would result in one third of small businesses closing permanently...

Using a real life example of a business you know well, how is it affected by the crisis and how it plans to survive in the future. You should try to incorporate any pertinent financial topics (such as: fundraising, the Fed, monetary and/or fiscal policy, bank lending, etc.) and include graphs, tables, charts to aid in your explanation.

Two clever kids from Kentucky use a huge spring with spring constant k= 890 N/m to launch their sled at the top of a 9.5 m high hill. The mass of kids plus the sled is 80 kg. The brilliant kids are able to compress the spring 2.6 m.

a. Determine their speed at the bottom of the hill. Neglect friction. Use conservation of energy.

b. What fraction of their final kinetic energy was initially stored in the spring?

c. Now assume that the surface of the snow is not frictionless and has a coeficcient of kinetic friction uk=0.100. Determine their speed at the bottom of the hill. Assume that the slope has an average incline of 60 degree.

Please show your work clearly and write step by step solution including numeric substitutions and etc. To make it easier, please do this in paper and include the pictures. thanks

1. Answer the following questions concerning covered and uncovered interest rate differentials and parity conditions:

a. Suppose the spot dollar-euro exchange rate is $1.20/€ , and the 60-day forward rate is $1.24/€. Is the euro selling at a forward discount or premium? What about the dollar?

b. Now suppose the interest rates on one-year U.S. and Eurozone (EMU) bonds are rUS = 5% and rEMU = 3%. You expect that, one year from now, the dollar-euro exchange rate will be at $1.26/€. Today the rate is $1.20/€.  Which should you invest in, the U.S. or EMU bond? Explain Hint use uncovered interest rate parity to get your answer.

c. Suppose the interest rate is 4% in the US and 8% in the UK.  If the actual exchange rate is e = $2.00/£1 (home is the US), what must the expected exchange rate e^e be?

Paul and Tina are age 66 and 62 respectfully. They file a joint return. They have itemized deductions totaling $15,000. They support their 24 year old son, Jed who goes to school on a full time basis. He earns $4,000 per year as a waiter at a restaurant.

Paul and Tina also support a friend Janice who came to dinner one evening and never left. She does not earn any money.

Wages ……………………………………   $170,000

Interest from savings ……………………           12,000

Interest on NYS qualified bonds …………           7,000

Inheritance from Tina’s Aunt Lucy…………       6,000

Alimony paid to Tina’s ex husband                       8,000

Child support from Tina’s ex husband Eric..       10,000

Prize from contest at church……………….          1,000

Dividend from ABC Corp. stock …………           2,000

1. What is Paul and Tina’s gross income?

2. What is Paul and Tina’s adjusted gross income?

3. What is Paul and Tina’s standard deduction?

4. What is Paul and Tina’s tax liability?

Please Compute Gross Income, Adjusted Gross income, and Taxable income based on the following information below.

2. For a survey, one has a target population and a frame from which the sur- vey sample is drawn. Describe two ways a frame can differ from the target population.

3. (c) A local Christchurch organisation wants to find out how people living in Christ- church feel about the Christchurch City Council’s performance. The organi- sation plans to collect responses by surveying people in the central city and several shopping malls throughout Christchurch. Describe the advantages and disadvantages of using this as the survey frame in terms of the target popula- tion. You may wish to define the target population.

4. (d) To select the people in the mall to answer the survey it is planned to just let interviewers choose the people to survey. Explain how this could affect the results and why random sampling is a much better way to sample.

5. (e) Describe another way the data could be collected other than by sampling in malls. Clearly explain why this would provide better coverage of the target population.

Q1 Which of the following taxes is not deductible?

Select one:

a. Goods and Services Tax

b. None of the answers are correct

c. Payroll tax

e. Fringe Benefits Tax

Which of the following amounts is fully deductible?

Select one:

b. Regular giving of $50 per week to the local church

d. A gift of $4,000 to a political party

e. A gift of $3,000 cash to a Deductible Gift Recipient

Q3 Which of the following transactions is fully deductible?

Select one:

a. An allowance for doubtful debts of $6,000

d. None of the answers are correct

e. A bad debt of $880 including GST (relates to sales not previously included as assessable income)

these questions is about chapter 9 of prepare tax documentation for individuals and this chapter will be determine amounts deductible under specific provision of the ACT

- specific deductions under section 8-5   

- tax related expenses

- repairs

-lease document expense

- borrowing expense

-mortgage discharge expense

- bad debit

Taxes are the way our government generates income. Although the richest Io/o of the people in our country pay 39% of the taxes and the bottom 50% combined pay only 2.9% combined, everyone wants things from the government. They want roads and bridges and schools and an army and welfare and Medicaid and concerts and ]..... To provide these things our government has to raise money and cut expenses. Which of the following laws help raise money? Which help cut expenses?

1)Deduction for contribution to the church

2) American Opportunity Credit for attending San Jacinto College

3) Deduction for gift to the American Red Cross

4) Child credit

5) Deduction for mortgage interest

6) Deduction for home equity loan

7) Deduction for savings bond interest used for higher education (2 things)

8) Deduction for health savings account

9) Deduction for student loan interest

10) Adoption credit

11) Earned Income credit

12) IRA deduction

Please read the following article:

"Is the stock market good stewardship?"

As previously discussed in week 3, a direct relationship exists between higher risk and higher returns. In order for an individual or organization to recognize higher returns on their investments, it usually requires the assumption of a higher level of risk. Please answer the following questions:

Is it appropriate for Christians to assume a high level of risk in their investment portfolios? When might it be appropriate?

Is it appropriate for nonprofit organizations who rely upon donations to invest in risky assets such as the stock market?

Assuming there should be limits, what types of investments would or would not be appropriate?

What implications do your positions have for the potential investment income or operations of the nonprofit organization or the individual’s financial position?

1) No Christians are frbidden from gambling. Speculative investments is non-biblical.

2) It might be approporate if the proceeds are directed towards the church only.

3) No. It is not appropriate to use people's donations for speculative purposes.

4) Investing high rated bonds is appropriate.