Economics questions: Answer all questions precisely as required in the requirements for each question.

15 Some major accountancy firms have converted themselves from traditional partnerships to limited liability partnerships (LLP). Explain the potential advantages of doing so. [S] 16 Test the proposition that agency problems can be eliminated by paying company directors with a mixture of shares and salary. [5] 17 Describe why swaps are mutually beneficial to both parties. [5]Three different drugs are being compared for their effectiveness in treating a certain illness. The mean number of days before the patient is discharged from hospital under each treatment is summarised below, together with the sample size and the sum of squares of the observations: Treatment Sample size Sample mean Sum of squares A 10 264 B 6 310 84 (i) For these three treatments, calculate estimates for the: (a) overall mean (b) common underlying variance. [4] (ii) Perform an analysis of variance to show that real differences exist among the three treatments at the 1% level. [3] (iii) Show that the mean number of days before discharge under treatment A is significantly better than under treatment B. [3] (iv) The cost per day for treatments A. B and C are f7.50, f5.85 and f14.95 respectively. Given that it can also be shown that there are significant differences between each pair of treatments, briefly advise the hospital on which treatment it should use. [2] [Total 12]Three different drugs are being compared for their effectiveness in treating a certain illness. The mean number of days before the patient is discharged from hospital under each treatment is summarised below, together with the sample size and the sum of squares of the observations: Treatment Sample size Sample mean Sum of squares A 10 264 B 6 310 84 (i) For these three treatments, calculate estimates for the: (a) overall mean (b) common underlying variance. [4] (ii) Perform an analysis of variance to show that real differences exist among the three treatments at the 1% level. [3] (iii) Show that the mean number of days before discharge under treatment A is significantly better than under treatment B. [3] (iv) The cost per day for treatments A. B and C are f7.50, f5.85 and f14.95 respectively. Given that it can also be shown that there are significant differences between each pair of treatments, briefly advise the hospital on which treatment it should use. [2] [Total 12]The force of interest (t) is: 6(1) =0.005f + 0.00012 for all f (i) At / =8, calculate the accumulated value of an investment of $100 made at time 1=0. [3] (ii) Calculate the constant annual effective rate of interest over the eight year period. [2] [Total 5]