A consumer wants to consume two goods. The prices of the two goods are Rs 4 and Rs 5 respectively. The consumer’s income is Rs 20. (i) Write down the equation of the budget line. (ii) How much of good 1 can the consumer consume if she spends her entire income on that good? (iii) How much of good 2 can she consume if she spends her entire income on that good? (iv) What is the slope of the budget line?
If you were offered $15,000 fifteen years from now in return for an investment of $5,000 currently, what annual rate of interest would you earn if you took the offer?
A company has 5 million common stock. If the market price of the stock is $45 what is the market value of equity?
If a stock pays a dividend of $50 and its market price is $950. What is the current yield of that stock?
Mr. B will receive $100,000 at the end of the 5th year. If opportunity cost is 9%. What will be the present value of the amount today?
If you bought a security at $1,000 and after one year it is sold for $1,250
What is the holding period return of the investment?
$50,000 borrowed from a bank for a simple interest of 8% p.a. for three years. What is the amount of interest to be paid on loan at the end of three year ?
In an experiment with cosmic rays, a vertical beam of particles that have charge of magnitude 3e and mass 12 times the proton mass enters a
uniform horizontal magnetic field of 0.250 T and is bent in a semicircle of diameter 95.0 cm, as shown in the figure.
a) Find the speed of the particles.
b) Find the sign of particles' charge.
c) Is it reasonable to ignore the gravity force on the particles?
d) How does the speed of the particles as they enter the field compare to their speed as they exit the field?
If the risk-free rate in the market is 4% and the expected return from the market is 10%. What will be the expected return from your stock if it has a beta of 1.2?
If a loan of $100,000 is taken from a bank at 12% interest compounded monthly. What amount of loan will be repaid at the end of 2nd year?
If an investment of $50,000 is made today carrying at an interest rate of 5%. What will be its value after 10 years?
A company has just paid a dividend of $1.50 and it is expected to grow 6% per year for an indefinite period of time. If the required rate of return on the stock is 12% What would you pay most for the stock?
Discuss the central problems of the economy.
The central problems of an economy are
i) What to produce?
ii) How to produce?
iii) For whom to produce?
Distinguish between a centrally planned economy and a market economy.
What is a production possibility frontier in terms of economics?