NAKED ECONOMICS Chapters 11 and 12 CHAPTER 11: INTERNATIONAL ECONOMICS ERM: Exchange Rate Mechanism This agreement was designed to manage large fluctuations in the exchange rate between European nations The ERM created targets for the exchange rates among the participating countries Each government was obligated to pursue policies that kept its currency trading on international currency markets within a narrow band around this target Currencies are no different than any other good; the exchange
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CAPM 1 Calculate the expected return for A Industries which has a beta of 1.75 when the risk free rate is 0.03 and you expect the market return to be 0.11. 2 Calculate the expected return for B Services which has a beta of 0.83 when the risk free rate is 0.05 and you expect the market return to be 0.12. 3 Calculate the expected return for C Inc. which has a beta of 0.8 when the risk free rate is 0.04 and you expect the market return to be 0.12. 4 Calculate the expected return for D Industries
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STRATEGY & FINANCE MID-SEMESTER ASSIGNMENT Dr. John Heptonstall Bao Chau Nguyen Xuan May 2011 I/ Summary of FVC & RSE’s business activities 1. Flinder Valves and Controls Inc. Flinder Valves and Controls Inc. is a small company located in Southern California‚ manufactured specialty valves & heat exchangers. This company realized an outgrowth in 1980s of previous century from a small company for engineering on an experimental heat-exchanger product. After 7 years‚ it acquired the properties of
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the U.S. Some have gone as far as calling it "currency manipulation." The outcome has been loss of U.S. manufacturing jobs and a U.S. trade deficit (Labonte & Morrison‚ 2005). Political Pressure According to the Bush Administration‚ China ’s undervalued currency has contributed to America ’s record $16 billion trade deficit with China last year and is responsible for the loss of 3 million U.S. manufacturing jobs since 2000. The G-7 discussions addressed the issue‚ but opinions differed. China felt
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INTRODUCTION • Kimi Ford‚ a portfolio manager of a large mutual fund management firm‚ is looking into the viability of investing in the stocks of Nike for the fund that she manages. • Ford should base her decision on data on the company which were disclosed in the 2001 fiscal reports. While Nike management addressed several issues that are causing the decrease in market sales and prices of stocks‚ management presented its plans to improve and perform better. • Third party sources also gave
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Solution to Case 02 Risk and Return Flirting With Risk Questions: 1. Imagine you are Bill. How would you explain to Mary the relationship between risk and return of individual stocks? I would explain to Mary that risk and return are positively related‚ i.e. if one expects to earn higher returns‚ then one has to be willing to invest in stocks whose price can vary significantly from year to year or in different economic conditions. For example‚ in the table
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• Consolidation journals are posted into the consolidation worksheet in “adjustment” columns as follows: Extract only Parent P Ltd. $’000 Subsidiary S Ltd. $’000 Adjustments DR Lecture 9 part b Consolidation: Wholly owned subsidiaries Prepared by Emma Holmes and Rick Newby Land Invt in S Ltd Receivables Cash 400 120 200 40 760 150 Share capital Retained earnings Creditors 500 160 100 760 100 20 50 170 Cons. Balances CR XX XX XX
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A Financial Analysis of Yum! Brands‚ Inc Restaurants are‚ and will continue to be‚ an extremely profitable business. As a result‚ shareholders who have interest in brands such as McDonalds and Starbucks need not to worry about negative implications for the food giants compared to more risky industries. One company in particular‚ Yum! Brands (YUM)‚ is another brand investors should become familiar with. Consumers may recognize the more specific stores the company owns such as Taco Bell and Pizza
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Women have come a long way from the early 1900’s when they gained their equal right to vote‚ to now where it seems women have equal rights to do just about anything. Women have been increasingly joining the economic work force since the last 100 years or so. Although‚ women in the work force have been increasing in numbers are they given an equal and fair chance compared to that of men? A quick glance on the subject would suggest that women are given equal and fair chances in the work force; however
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profits. Optimize the use of debt in the capital structure: because firms with lower percentage of debt have higher value‚ Marriott uses this strategy to increase its value and thereby increase it profitability. Repurchase undervalued shares: By buying back its undervalued shares‚ Marriott can increase PE ration when needed and can make its investors’ holdings more valuable because share prices will increase (increase in ROE). It also can appease investors and avoid pressure to increase dividend
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