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- 1Extensions Help | Arial 1 Last edit was seconds ago 11 1 + BIUA ¹2' 3 C 田 5 6 1. What are 2 examples of variables that can have a correlation to the demand/forecast of a product your company makes? 2. What does it mean when we say we use the BOM to do an MRP MacBook Pro U = = == explosion? 3. Explain what do we call "Strategic Stock". Give an example of when this could be triggered I 7 125. Which of the following statements about financial crises is correct? a. They have involved loss of confidence and runs on financial institutions. b. They have been a recurrent feature of the U.S. economy since at least 1873. c. Such crises had a major role in the causation of both the Great Depression or the Great Recession. d. all of the above
- 1. You are given the following sample annual data about the prices of Alibaba and Google stocks: a. b. C. Time End-2018 End-2019 End-2020 End-2021 End-2022 ( stocks. stocks. Alibaba Stocks $148.50 $157.34 $165.75 $177.00 $190.24 Google Stocks $1,564.23 $1,723.26 $1,700.54 $1,894,23 $1,900.23 Determine the sample covariance of the returns of Alibaba and Google stocks. Compute for the sample standard deviation of the returns of Alibaba and Google ) Determine the sample correlation between the returns of Alibaba and Google9. Efficient markets hypothesis Which of the following statements are consistent with the efficient markets hypothesis? Check all that apply. You should spend several hours a day studying the business section of your local newspaper to determine which stocks to add to your investment portfolio. The stock market is informationally efficient. An average person in the market will believe that all stocks are fairly valued.Suppose instead Larry decides to buy 100 shares of NanoSpeck stock. Which of the following statements are correct? Check all that apply. O C The price of his shares will rise if NanoSpeck issues additional shares of stock. NanoSpeck earns revenue when Larry purchases 100 shares, even if he purchases them from an existing shareholder. Expectations of a recession that will reduce economywide corporate profits will likely cause the value of Larry's shares to decline.
- E3There is much speculation on how the current foreclosure market will evolve due to a variety of factors such as The expiration of COVID related forbearance and mortgage protection programs. • Discuss how these factors will change the foreclosure market in the coming year. Following essay format3. According to an article on the junk bond market in Europe published in the Economist in 2016, "The spread (the interest premium over government borrowing rates) paid by junk-bond issuers has risen by nearly three-and-a-half percentage points since March last year." (a) How can you tell whether a newly issued bond is a junk bond? (b) Why would the spread between government bonds and junk bonds have been rising? (c) Does this increase in the spread make junk bonds a better or a worse investment compared with buying government-issued bonds? Briefly explain.
- 3.18 BOP Transactions. Identify the correct BOP ac-count for each of the following transactions: a.A German-based pension fund buys U.S. govern-ment 30-year bonds for its investment portfolio. b. Scandinavian Airlines System (SAS) buys jet fuel at Newark Airport for its flight to Copenhagen. c. Hong Kong students pay tuition to the University of California, Berkeley. d. The U.S. Air Force buys food in South Korea to supply its air crews. e. A Japanese auto company pays the salaries of its executives working for its U.S. subsidiaries. f. A U.S. tourist pays for a restaurant meal in Bangkok. g. A Colombian citizen smuggles cocaine into the United States, receives cash, and smuggles the dollars back into Colombia. h. A U.K. corporation purchases a euro-denomi-nated bond from an Italian MNEHow did the stock market boom led to the Housing bubble and the 2008 Financial Crises? Draw three parallels between the 2008 Financial Crisis and the 2020 Pandemic Recession If the risk associated with a company goes up, what would you expect to happen to the price of its stock? And if the risk associated with a company declines, what would you expect to happen to the price of its stock?17. When the interest rate in an economy rises, the stock market typically reacts negatively. This is because (a) the future dividends companies provide to their investors are discounted more heav- ily. (b) the present values of the future dividends companies provide to their investors decrease. (e) investors sell their investments in the stock market and deposit the money into banks. (d) All of the above are correct. 18. Suppose that the interest rate is 8%. The sum of the present values of three payments of $500 to be received in 3 consecutive years is calculated as (a) 8500 x 1.08 x 3 (b) S00 (1.08) (1.08 1O8 (c) 8500 x 1.08 + 8500 x (1.08)2 + 8500 x (1.08)3 (d) x 3 1O8 19. When a person buys insurance, which of the following best describes the economic transaction? (a) The person donates money to the insurance company. (b) The insurance company pays the person to buy the risk, a desirable commodity, from him/her. (c) The person pays to sell the risk, an undesirable commodity, to…