You are trying to design a system that will determine whether someone has a PhD in music. You have the following information:

• The probability that a music PhD can correctly identify a composer from a 5-second audio clip is 85%
• The probability that anyone else can identify a composer from a 5-second audio clip is 2%
• Music PhDs make up 0.3% of the population

You stop someone on the street and play them a 5-second segment of Claire de Lune. They correctly identify the composer as Debussy. Based on the information above, what is the probability that this person has a music PhD?

There are three theories that explain exchange rate behaviour, two of these deals with how inflation rates affect the exchange rate. They are purchasing power parity (PPP) and International Fisher Effect (IFE).

(a) In reality, PPP does not hold. Even PPP holds, this does not consistently occur. Give two major reasons why PPP does not hold consistently. Explain in detail.

(b) Assume the spot exchange rate of Singapore dollar to US dollar is US$0.7420/S$. The one-year interest rate is 0.3% in U.S. and 6% in Singapore. What would be the spot rate in one year according to IFE?

Your marketing research department provides the following estimated demand function for your product: Qd = 500.6 - 11.4P + 0.5INCOME where P is the price of your product and INCOME is average income.

a. Is your product a normal good or an inferior good? Explain your answer.

b. The standard error for the price coefficient is 2.0. What is its t-statistic? What can you conclude about the coefficient's statistical significance?

c. The standard error for the income coefficient is 0.3. What is its t-statistic? What can you conclude about the coefficient's statistical significance?

Interest rates in India are 5.25% p.a. and in Brazil they are currently at 2.5% p.a. The BRL/INR spot rate is 13.37.

(a) Calculate the theoretical three-year forward rate of the BRL implied by Interest Rate Parity.

(b) Now assume the actual two-year forward rate is BRL/INR 15.20. What, if any, is the percentage return from engaging in Covered Interest Arbitrage? Assume a transaction cost of 0.3% in the spot and the forward market. (Calculate the result as a percentage of your initial borrowing, accurate to 4 decimal places, making sure to include any opportunity cost in your calculations)

Interest rates in India are 5.25% p.a. and in Brazil they are currently at 2.5% p.a. The BRL/INR spot rate is 13.37. (a) Calculate the theoretical three-year forward rate of the BRL implied by Interest Rate Parity. (b) Now assume the actual two-year forward rate is BRL/INR 15.20. What, if any, is the percentage return from engaging in Covered Interest Arbitrage? Assume a transaction cost of 0.3% in the spot and the forward market. (Calculate the result as a percentage of your initial borrowing, accurate to 4 decimal places, making sure to include any opportunity cost in your calculations)

1. We have two samples of people who took a literacy test, termed Literacy A and Literacy B which are from two different states. Researches are interested if there's a difference in literacy between the two states. First use folded F test to see if the varianceare equal or not, then T- test

Jeremy earned $100,000 in salary and $6,000 in interest income during the year. Jeremy’s employer withheld $11,000 of federal income taxes from Jeremy’s paychecks during the year. Jeremy has one qualifying dependent child who lives with him. Jeremey qualifies to file as head of household. Assume the original facts except that Jeremy had only $7,000 in itemized deductions. ( use 2019 )

1. (1.3) Determine Jeremy’s tax refund or taxes due. You must show work.

2. (0.3) Copy and paste the applicable table showing tax rates used.

3. Comment (optional)

Using a dividend discount model, what is the price for this stock? Stock covariance with the market= 0.5 Market variance = 0.25 Stock covariance with a second risk factor= 0.6 Variance of the second factor= 0.3 Market Premium:3% Second factor risk premium=1% Risk free rate =2 % Current earnings per share= $5, The ROE is expected to shrink (decrease) at the rate 10% for first 5 years The ROE is expected to grow at the rate 8% forever after the first 5 years Payout for the first 5 years: 50% Payout after 5 years: 50%

.You are interested in determining whether there is a statistically significant difference between
economics and political science majors in terms of their overall grade point average (GPA). You
randomly sample 10 economics majors and 16 political science majors. You find that the average
economist has a 3.0 GPA with a standard deviation of 0.4, and the average political scientist has
a 3.4 GPA with a standard deviation of 0.3. Conduct a two-tailed hypothesis test using
significance level α = 0.05. Clearly state the hypotheses, the test statistic, the p-value, and your
conclusion (in complete, plain language sentences).