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please help me i dot have anymore remaining please i need help with all of the questions Q1) Find 4 different metals where I can
please help me i dot have anymore remaining please i need help with all of the questions
Q1) Find 4 different metals where I can buy/sell futures on those metals on the London Metal Exchange (LME). For each of those metals, find out how much metal 1 futures contract is for. Q2) Xian and Devi are each buying a house for $500,000. Xian puts $200,000 down and gets a mortgage for the other $300,000 at a 6% annual effective rate. Devi puts $100,00 down and gets a mortgage for the other $400,000 at the same annual rate. Both mortgages are interest only (.e they pay 5% interest at the end of each year but do not repay any of the principal.) a) How much leverage does Xian have? How much leverage does Devi have? b) After 1 year, if the house increases in value by 5%, what is Xian's return on his investment (ROI) in the house? What is Devi's? c) What are their respective ROI's if you include the interest they have to pay on their mortgages? d) Devi invested only $100,000 in the house. She invests the other $100,000 (so her total investment is $200,000 matching Xian's) in a savings account paying an effective annual rate of x%. What does x have to be so that her ROI on her total investment matches Xian's? Q3) Boris and Natasha agree to play the following game. They will flip a (fair) coin 5 times in a row. They will compute S = ( number of heads H - number of tails T). a) Boris will pay Natasha S. Graph Natasha's payoff as a function of S. What is the expected value of S? b) How much should Natasha be willing to pay Boris to play this game? After paying this amount, what is her best case and worst case outcome? This time, after 5 flips of the coin, if there are more heads H than tails T, Boris will pay Natasha H - T. If there are more tails T than heads H, Boris will pay Natasha nothing. c) Graph Natasha's payoff as a function of S = H - T. What does this graph remind you of? d) What is the expected value of Natasha's payoff? How much should she be willing to pay to play this game? After paying this amount, what is her best case and worst case outcome? Q4) Carlos buys 100 shares of IBM for $100 per share on 50% margin. a) How much money does Carlos need to give to his broker, and how much money does he borrow? b) If IBM goes up to $120 per share, how many more shares could Carlos sell without sending his broker more money? c) If IBM goes down to $80 per share, how much money does Carlos have to send his broker to get back to the 50% margin requirement? d) Instead of sending his broker more money, Carlos sells some of his shares (at $80 per share) to get his account back to 50% margin. How many shares does he have to sellStep by Step Solution
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