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Sergeu [11.5K]
1 year ago
8

Is the futures price of a stock index greater than or less than the expected future value of the index? Explain your answer.

Business
1 answer:
stepan [7]1 year ago
8 0

Answer:

It can be greater as well as less.

Explanation:

1st of all we should know what is Future Price and what is Stock Index.

The futures price can be more or less that the predicted fee.

When futures costs are lower than predicted price spot fees, the situation is known as normal backwardation.

When futures prices are higher than anticipated spot charges, it is called normal contango

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g If term premiums are positive, _____. long-term investors dominate the market the spread between yields on long-term and short
DedPeter [7]

Answer:

The spread between yields on long-term and short-term bonds is positive

Explanation:

When term premiums are positive, the yield curve is considered normal, this means that long-term bonds have a higher yield to maturity than short-term bonds, due to the higher risks associated with long-term bonds.

If long-term bonds have a higher yield to maturity (YTM) than short-term bonds, this means that the spread: the difference between the term premiums of long-term bonds and short-term bonds, will be positive.

For example, if the YTM of a 10 year bond is 8%, and the YTM of a 1 year bond is 4%, the spread of of the term premiums will:

8 - 4 = 4%, a positive spread.

5 0
2 years ago
A​ person's website specializes in the sale of rare or unusual vegetable seeds. He sells packets of​ sweet-pepper seeds for ​$2.
ANTONII [103]

Answer:

7 packets of  sweet-pepper seeds and 9 packet of hot-pepper seeds.

Explanation:

Let x packets of​ sweet-pepper seeds for ​$2.16 each and y packets of​ hot-pepper seeds for ​$4.24 each are mixed to obtain 16​-packet mixed pepper assortment for ​$3.33 per packet,

i.e. x + y = 16       ..........(1)

Also,

The price of sweet-pepper seeds + price of hot pepper seeds = price of the mixture

⇒ 2.16x + 4.24y = 3.33(x+y)

⇒ 2.16x + 4.24y = 3.33x+3.33y

⇒ 2.16x + 4.24y - 3.33x-3.33y = 0

⇒ −1.17x +0.91y = 0  ........(2)

Equation (2) + 1.17 × equation (1)

0.91y + 1.17y = 18.72

2.08y = 18.72

⇒ y = 9

From equation (1),

x + 9 = 16 ⇒ x = 16 - 9 ⇒ x = 7

Hence, there are 7 packets of  sweet-pepper seeds and 9 packet of hot-pepper seeds.

7 0
1 year ago
Identify whether each scenario describes a drawback or an advantage of trade regulation.
Sunny_sXe [5.5K]

Top one is advantage, second down is a drawback, advantage for the third, and the last one on the bottom is a drawback.

3 0
2 years ago
Read 2 more answers
Both SAR and EC are important attributes of irrigation water. What do these measures indicate? What is the danger of irrigation
PSYCHO15rus [73]

Answer:

a. SAR is the Sodium adsorption ratio of the water used for irrigation purpose. SAR is ratio of sodium concentration to that of calcium and magnesium concentration.This value is also useful while managing soils that have high concentration of sodium which can occur naturally in some soils.  Although sodium is a macro-nutrient for plants, higher concentration of sodium can cause the displacement of the calcium and magnesium ions in soil which can affect the soil structure by preventing aggregation of clay in the soil resulting in a decrease in the infiltration rates.

b. EC is the electrical conductivity of the soil which depends on the salinity of the soil. High salinity means more solutes in water and this increases the osmotic potential of the soil solution making it difficult for plants to absorb water.

4 0
1 year ago
Delta Insurance Company has a surplus-share treaty with Eversafe Reinsurance. Delta has a retention limit of $200,000, and nine
Luba_88 [7]

Answer:

Delta is responsible for insuring $200,000 / $1,600,000 = 1/8 of the building

Eversafe is responsible for 1 - 1/8 = 7/8

the loss = $1,600,000 x 40% = $640,000

Delta will pay 1/8 x $640,000 = $80,000

Eversafe will pay $640,000 - $80,000 = $560,000

in order for Eversafe to pay:

  • $600,000, the total loss = $685,714, or 42.86% of the building
  • $700,000, the total loss = $800,000, or 50% of the building
  • $720,000, the total loss = $822,857, or 51.43% of the building
  • $800,000, the total loss = $914,286, or 57.14% of the building
3 0
1 year ago
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