EBK INTERMEDIATE MICROECONOMICS AND ITS
EBK INTERMEDIATE MICROECONOMICS AND ITS
12th Edition
ISBN: 9781305176386
Author: Snyder
Publisher: YUZU
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Chapter 4, Problem 6RQ
To determine

To find:The purchase of one country stock or mixture of two country stock. The answer when the Japan stock market gives mirror of U.S. stock market.

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You have two roommates who invest in the stock market.​ a. One roommate says she buy shares only in companies that everyone believes will experience big increases in profits in the future. How do you suppose the price-earnings ratio of these companies compares to the price-earnings ratio of other companies? What might be the disadvantage of buying shares in these companies? b. Another roommate says she only buys shares in companies that are cheap, which she measures by low price-earnings ratios. How do you suppose the earnings prospects of these companies compare to those of other companies? What might be the disadvantage of buying shares in these companies?​
What happens to interest rates in the market if the stock brokerage commission declines? Explain the reason for your answer!
Discuss the pricing formula of a future contract on an investment asset that provides no income. How would you modify this formula if: The future is on a stock index that pays dividends? The future is on currencies?
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