| XYZ stock price and dividend history are as follows: |
| Year | Beginning-of-Year Price | Dividend Paid at Year-End |
| 2010 | $ 124 | $ 4 |
| 2011 | $ 135 | $ 4 |
| 2012 | $ 115 | $ 4 |
| 2013 | $ 120 | $ 4 |
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An investor buys six shares of XYZ at the beginning of 2010, buys another two shares at the beginning of 2011, sells one share at the beginning of 2012, and sells all seven remaining shares at the beginning of 2013. |
What are the geometric average time-weighted rates of return for the investor?
In: Finance
| XYZ stock price and dividend history are as follows: |
| Year | Beginning-of-Year Price | Dividend Paid at Year-End |
| 2010 | $ 124 | $ 4 |
| 2011 | $ 135 | $ 4 |
| 2012 | $ 115 | $ 4 |
| 2013 | $ 120 | $ 4 |
|
An investor buys six shares of XYZ at the beginning of 2010, buys another two shares at the beginning of 2011, sells one share at the beginning of 2012, and sells all seven remaining shares at the beginning of 2013. |
|
To compute dollar-weighted return, prepare a chart of cash flows for the four dates corresponding to the turns of the year for January 1, 2010, to January 1, 2013. (Enter your answer as an integer. Negative amounts should be indicated by a minus sign.) |
| Date | Cash Flow (for the investor) |
| 1/1/2013 | ? |
In: Finance
Black-Scholes-Merton model:
Using a spot price of $96 and strike price of $98, a risk-free rate of return of 6% and the fact that the volatility of the share price is 18%, answer following questions:
Note for calculations with the BSM model: Keep four decimal points for d1 and d2. Use the Table for N(x) with interpolation in calculating N(d1) and N(d2).
In: Finance
In: Economics
A single price monopoly charges:
Question 1 options:
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every customer the exact same price. |
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single people less than married people. |
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a different price to each and every customer. |
Which of the following is true about monopoly?
Question 2 options:
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there are many firms in the market. |
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there are no close substitutes for the monopolists' good/service. |
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there is free entry/exit in the short and long-run. |
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there are no barriers to entry, in the long-run. |
What does a single price monopoly have to do to increase its quantity sold?
Question 3 options:
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lower its price. |
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keep its price exactly the same. |
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raise its price. |
A monopolist can sell 10 units at $4 per unit, or 11 units at $3 per unit. The marginal revenue of the 11th unit is:
Question 4 options:
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$7 |
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$4 |
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-$7 |
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$3 |
In: Economics
u(x1, x2) = min {x1/2, x2/3}
if the price of good 1 is $7/unit, the price of good 2 is $4/unit and income is 114..
What is this person's optimal consumption level for good 2?
In: Economics
When the price is $2, the quantity demanded is 10. When the price rises to $8, the quantity demanded falls to 2. What is the value of the elasticity of demand? Is it elastic or inelastic?
In: Economics
Suppose Bethany buys both CDs and video games. The price of a CD is $15 and the price of a video game is $30. Suppose that given Bethany’s planned expenditures, she receives 900 utils from her last planned purchase of CDs and 1,200 utils from her last planned purchase of video games. Is she at the optimal combination of CDs and video games? Explain. If not, explain how she should alter her consumption bundle. (Hint: use Marginal utilities and prices in your answer). Also, graph a utility curve and budget line that might describe the situation in this problem. Explain graph.
In: Economics
True or False?
If the price elasticity of demand for cigarettes is –0.50 and the price of cigarettes increases 10%, the quantity demanded of cigarettes decreases by 50%.
In: Economics
1) Demand pull inflation occurs when the:
price of necessity goods increases suddenly.
price level changes in response to changes in the business cycle.
business cycle becomes sporadic and unpredictable.
price of a key input increases suddenly.
2) While the __________ is not important, the _________ can have a big effect on economic behavior.
price level; predictable change in the price level
predictable change in the price level; price level
price level; unpredicted change in the price level
unpredicted change in the price level; price level
3) When real rates of interest are negative, borrowers:
benefit, because the value of their debt increases.
suffer, because the value of their debt increases.
suffer, because the value of their debt declines.
benefit, because the value of their debt declines.
4) Unexpected high inflation redistributes wealth from:
those who save to those who borrow.
banks to those who save.
those who borrow to those who save.
those who borrow to banks.
5) When banks hold excess reserves the:
money multiplier underestimates how much money will be created in the economy.
money multiplier overestimates how much money will be created in the economy.
reserve ratio is not fully functioning, and should be raised.
reserve ratio is not fully functioning, and should be lowered.
In: Economics