You run an alcohol abuse prevention education for older adul…

You run an alcohol abuse prevention education for older adults. You are asked to complete an evaluation of the program because recently some community members asked the county to not fund this program because they had read previous studies about the DARE program and said these programs do not work. You believe the program is meeting its goals and want to show that it is a good use of public funds. This is an example of which reason to evaluate programs?

Suppose you observe the following exchange rates: S($/£) = 1…

Suppose you observe the following exchange rates: S($/£) = 1.3. The one-year forward rate is F1($/£) = 1.32. The risk-free interest rate in the U.S. is 5% and in UK it is 2%. You can borrow either $1,300,000 or £1,000,000. Briefly and clearly explain your arbitrage strategy. Show your work in each step to receive partial credits. 

Suppose you observe the following exchange rates: S($/£) = 1…

Suppose you observe the following exchange rates: S($/£) = 1.3. The one-year forward rate is F1($/£) = 1.32. The risk-free interest rate in the U.S. is 5% and in UK it is 2%. You can borrow either $1,300,000 or £1,000,000. Your total arbitrage profit will be $ (please leave whole dollars for your answer).

A U.S. firm holds an asset in UK and considers selling it in…

A U.S. firm holds an asset in UK and considers selling it in one year. The firm faces the following scenario of the future spot rates in one year:   State 1 State 2 State 3 State 4 State 5 Probability 20% 20% 20% 20% 20% Spot rate ($/£) 1.6 1.5 1.4 1.3 1.2 P*(£) 1200 1400 1600 1800 2000 P ($) $1920 $2100 $2240 $2340 $2400 In the above table, P* is the pound price (local price) of the asset in UK held by the U.S. firm and P is the dollar price of the asset. The variance of the dollar value of the hedged position is .