Consider the US market for vaccines. Vaccines prevent the consumer of the vaccine from getting viral infections and also reduce the risk of other people getting infections. Construct a graph that describes the vaccine market in the US (numbers are not necessary). Make sure to label the axes and show the following elements:

a. The private marginal cost (PMC) curve for vaccines

b. The private marginal benefit (PMB) curve for vaccines

c. The social marginal cost curve (SMC) for vaccines

d. The social marginal benefit (SMB) curve for vaccines

e. Identify the quantity and price of vaccines in a competitive market equilibrium (i.e. a free market without government regulation) as QM and PM

f. Identify the socially efficient quantity of vaccines as QS and explain why you feel this quantity maximizes social welfare in the vaccine market.

g. Shade in the area that corresponds to the deadweight loss if the quantity of vaccines is QM instead of QS

h. Does the market produce too many or too little vaccines? Why?

A US multinational received an order for airplane parts from Australia for delivery in one year. The total invoice is A$1,000,000 and payable in six months. The expected spot prices to prevail in six months range from $0.55 to $0.85. The following information is available:

Spot rate                                  $0.70/AUD
6-month forward rate           $0.68/AUD.
Interest rate in US4.00%
Interest rate in Australia8.00%
Call option premium$0.12E=$0.70
Put Optionpremium$0.10 E=$0.70

1. How can the firm hedge using forward rates? Show the payoffs for the expected spot rates.
2. How can the firm hedge using money market rates? Show the payoffs for the expected spot rates.
3. How can the firm hedge using options. Show the payoffs for the expected spot rates.
4. Which hedging would you recommend?

The following is average weekly per pound price data for apple pears in the US (from usda.gov) starting May. Your employer wants you to determine forecasted average weekly price for all the weeks starting in May.

1. For each period starting in May (through August 6), determine the forecasted values (round all responses to two decimal places) using:
   1. Naïve previous period
   2. Four-period moving average
   3. Four-period weighted moving average (w₁=0.35, w₂=0.3, w₃=0.25, w₄=0.10).
   4. Exponential smoothing with an α= .35. Make the assumption that the forecasted value of May 20 is equal to the actual value of May 20.

To receive any credit for filling out the above table, you must show your hand written work on attached pages. You should also double check your work using Excel (Excel for forecasting won’t be graded).

2. For the last four periods in the month of July (includes: July 8, July 15, July 22, and July 29),
   1. calculate MAD, MSE, and MAPE (ok to use Excel here), and fill out the following table

2. Which forecasting technique do you recommend the company uses? Justify your response.

Describe the steps and parts of the accounting cycle that take us from individual transactions all the way to formal published financial statement.

Do you agree with the change in US GAAP from purchase and pooling of interest methods to the acquisition method? What are a few advantages and disadvantages?

Let us assume that from a population with mean ?=100 and standard deviation ?=15 a sample random variable of ?=900 is selected.
a. What is the probability ?(?̅<101.1)?
b. What is the probability ?(?̅>101.5)?
c. What is the probability ?(99.3<?̅<100.5)?

Would the US be better off provided they stopped importing goods and services from the rest of the world? Why or why not?