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timama
2 months ago
8

Consider a basket of consumer goods that costs $60 in the United States. The same basket of goods costs NOK 40 in Norway. Holdin

g constant the cost of the basket in each country, compute the real exchange rates that would result from the two nominal exchange rates in the following table.Cost of Basket in US (Dollars) Cost of Basket in Norway(Korner) Nominal Exchange rate (Korner per dollar) Real exchange rate(Basket of norwegian goods per basket) 60 40 3.00 _________ 60 40 2.00 _________
Business
1 answer:
Katen [3.5K]2 months ago
7 0

Answer:

The real exchange rates calculated are 4.5 and 3

Explanation:

We understand that

Real exchange rate = Nominal exchange rate × (Basket cost in US ÷ Basket cost in Norway)

Utilizing this formula, the calculation proceeds as follows:

For a nominal exchange rate of 3, the real exchange rate is calculated as follows:

= 3 × (60 ÷ 40)

= 4.5

For a nominal exchange rate of 2, the real exchange rate is:

= 2 × (60 ÷ 40)

= 3

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How can inequality or discrimination hurt an economy's ability to maximize its human capital?
arsen [3447]
If individuals face discrimination and perceive themselves as unequal to other groups within their society, it is clear they will experience unhappiness, which can adversely affect their professional lives. Unhappiness can result in reduced effort and potential at work, ultimately leading to diminished profits for the company.
That's my perspective, anyway.:)
3 0
1 month ago
Read 2 more answers
Mart's Boutique has sales of $820,000 and costs of $540,000. Interest expense is $36,000 and depreciation is $59,000. The tax ra
Mariulka [3825]

Answer:

$146,150.00

Explanation:

Net income is calculated after taxes.

Here,

Sales = $820,000.00

Less: Expenses = -$540,000.00

Gross profit = $280,000.00

Less: Financial Expenses

Interest = -$36,000.00

Depreciation = -$59,000.00

Net profit before tax = $185,000.00

Less: Tax at 21% of $185,000.00 = - $38,850.00

Net Income (after taxes) = $146,150

Net income is always determined after accounting for tax.

$146,150.00

3 0
1 month ago
Consider an 8% coupon bond selling for $953.10 with three years until maturity making annual coupon payments. the interest rates
arsen [3447]

Answer:

a) YTM = 9.8%

b) realized compound yield = 9.9%

Explanation:

a) PMT is 80

par value FV = 1000

coupon rate = 8%

current price PV = 953.1

years to maturity n = 3

Yield to maturity (YTM) is calculated as \frac{PMT+(FV-PV)/n}{(FV+PV)/2} = \frac{80+(1000-953.1)/3}{(1000+953.1)/2}= 9.8%

b) r2 = 10% = 100%+10% = 1.1

r3 = 12% = 100%+12% = 1.12

To find the realized compound yield, we first need the future value (FV) of the principal and reinvested coupons.

FV = ($80 * 1.10 * 1.12) + ($80 * 1.12) + $1080 = $1268.16

Let a be the rate at which the future value equals $1268.16.

953.1(1+y)³ = $1268.16

(1+y)³ = 1.33

1+y = 1.099

y = 0.099 = 9.9%

5 0
3 months ago
A 10 percent increase in income leads to a 15% decrease in the quantity of macaroni and cheese demanded but no change in the pri
marusya05 [3725]

Answer:

(b) macaroni is categorized as an inferior good, and the price elasticity of supply is zero.

Explanation:

An increase in income by 10 percent results in a 15% reduction in the demand for macaroni and cheese without any change in price. This suggests that macaroni is indeed an inferior good with zero price elasticity of supply.

Inferior goods experience lower demand as incomes rise, supported by the observation that ‘’A 10 percent increase in income leads to a 15% decrease in the quantity of macaroni demanded’’.

In terms of price elasticity of supply, a value of zero indicates that the supply amount remains unchanged regardless of price fluctuations: the supply is "fixed". The original scenario states there was ''no change in the price of macaroni,'' indicating that the elasticity of supply in this situation is zero.

4 0
2 months ago
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