Explain why in practice arbitrage-free models are typically used rather than equilibrium models
What will be an ideal response?
Interest-rate models fall into two general categories: arbitrage models and equilibrium models. In practice, arbitrage-free models are typically used because they are easier to implement than equilibrium models.To illustrate, there are two concerns with implementing and using equilibrium models. First, many economic theories start with an assumption about the class of utility functions to describe how investors make choices. Equilibrium models are no exception: the model builder must specify the assumed class of utility functions. Second, these models are not calibrated to the market so that the prices obtained from the model can lead to arbitrage opportunities in the current term structure.
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Answer the following statements true (T) or false (F)
1.Audra tends to develop emotional support and unconsciously mirrors or imitates the moods and emotions of others. It can be said that Audra is highly empathetic. 2.Sometimes, Arturo gets angry with one or more of his friends and expresses that ager by communicating online with his message in all capital letters. When he does this, Arturo is expressing his anger by flaming. 3.“I need to get this project completed for work and would really appreciate your help.” When Lenny says this to Rupert, he is taking steps toward ending his friendship with Rupert. 4.When Travis told Kacee that he was not happy about the mess she left in the kitchen sink on Sunday, he said “I get a little upset with dirty dishes in the sink overnight” rather than saying “You left those dishes in the sink all night!” When Travis used “I” instead of “you,” he was acknowledging that he owned his feelings. 5.The negative beliefs we hold about actual events or people cause us mental anguish and lead to mental and even physical discomfort.
The intraperiod tax allocation involves separation of the income taxes on income from continuing operations from income taxes on discontinued operations and other comprehensive income
Indicate whether the statement is true or false
How do companies use the workload approach to set sales-force size?
What will be an ideal response?
To avoid being sued for failure to warn users of products, manufacturers must:
a. take lots of precautions in the manufacturing process b. invest a lot in safety research c. conduct regular customer satisfaction surveys d. have mandatory safety training sessions for all employees e. none of the other choices are completely correct