Answer:
C) in swap transactions where the trader is attempting to minimize currency exposure, the actual spot and outright forward rates are often of no consequence.
Explanation:
Swap transactions occur with negotiations based on the profitability of two goods, in relation to the profitability related to the value of a currency of a given location. As the currency value of these two goods can vary significantly, the traders involved in this process always seek to minimize currency exposure, as well as real cash rates. This gives space for bank brokers to use shortened laces notation, where future price predictions are considered.
Answer:
Explanation:
Using the dividend growth model = Do(1+g)/Ke-g
Do=1.62$
G=4%
Ke=12%
Do(1+g)/Ke-g = 2.0736(1+4%)/12%-4%
= 1.6848
/8%
= 53.916
Year Year Year Year Year
0 1 2 3 4
20% 20% 20% 20%
Dividend 1 1.2 1.44 1.728 2.0736
Ifninty dividend 55.91*
Total Cashflows 1 1.2 1.44 1.728 55.98
Pres.Val @12% 1 1.07142 1.14795 1.22995 35.583
Value of stock 40.030
Answer:
Begininig cash balance June 1 205
Explanation:
Sales April 430
Sales May 480
Begininig cash balance May 1 175
Cash expenses -110
Payments -290
Sales april 430
Begininig cash balance June 1 205
Answer: Balloon Loan
A balloon loan is a type of loan where the final payment is usually much larger than the payment preceding it.
In a balloon loan, the entire loan amount is given to the borrower as soon as the loan is approved and the contract is signed.
The interest falls due and is paid during the life of the loan.
The principal however, is paid as a balloon payment on the final day of the life of the loan.
