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NEW QUESTION: 1
Mandatory subgroup is defined as:
A. a subgroup of logically related data that is created by a process within the application boundary
B. one of two types of subgroups for RETs that the user must use during an elementary process
C. one of many types of subgroups for RETs that the user may or may not use during an elementary process
D. one of many types of subgroups for RETs
Answer: B

NEW QUESTION: 2
An organization needs to implement isolated logical structure due to compliance regulations.
What complex access control network virtualization method can it use?
A. The IT organization creates a quarantine network for end points that do not meet the posture assessment requirements
B. The IT organization acts as a client serving different, isolated departments
C. The IT organization creates a separate guest network for wireless and wired clients
Answer: A

NEW QUESTION: 3
Theresa Ponder and Rod Owens are analysts for a multinational investment bank, Datko Bank, based in Canada. Datko's clients have been advised to diversify globally, due to a decrease in expected long-term growth for North American economies.
As part of her analysis of global stocks, Ponder uses the domestic CAPM and the international CAPM to value stocks. She makes the following statements regarding the extension of the domestic capital asset pricing model (CAPM); Statement 1: To extend the domestic CAPM to international asset pricing using the extended CAPM, one must make two additional assumptions. First, that global investors have identical consumption baskets and second, that interest rate parity holds throughout the world.
Statement 2: The extended CAPM assumes that exchange rate changes are predictable so that there is no real exchange rate risk.
As the primary analyst for European securities, Owens analyzes the stocks in the countries of Catonia and Arbutia. Catonia and Arbutia arc not currently members of the European Union, but have a timetable for joining by the end of the decade.
To evaluate Caionian stocks, he uses the international CAPM. Owens mentions that a foreign currency risk premium must be added in this model, and that the risk premium depends on various parity conditions. He finds that the foreign exchange expectation relation and interest rate parity hold between Canada and Catonia. The interest rate in Canada is 2%, and the interest rate in Catonia is 5%.
One of the companies Owens follows in Arbutia is Diversified Metal Finishers. Diversified produces customized sheet metal applications for manufacturers throughout the world. The firm enjoys a competitive advantage because Arbutia is a commodity-rich country which allows Diversified to source its inputs locally. Owens has found that when the Arbutian currency changes by 10%, the value of the Diversified stock generally changes by 6%.
Ponder is also analyzing stocks in the nations of Bisharov and Dineva. She is estimating the expected return using the international CAPM (ICAPM) for Ivanova Metals, located in Dineva. The data for Canada, Dineva, and lvanova are shown in the following. The foreign currency is denoted as the local currency (LC).
Canadian risk-free rate 2.00%
Dineva risk-free rate 8.00%
World market risk premium 6.00%
Dineva index beta to world market index 1.40
Dineva local market risk premium 7.50%
Ivanova beta to local index 1.30
Foreign currency risk premium 3.00%
Dineva sensitivity of LC stock returns to LC 0.70
Owens examines Ponder's analysis and makes the following statements:
Statement 1: To protect the growing economy and prevent capital flight, the Bisharov government taxes foreign investors at higher rates and has placed limits on currency convertibility. In Dineva, the government has taken a more hands-off approach and does not regulate .foreign investment. If the world were to consist entirely of countries like Bisharov, then the ICAPM cannot be applied.
Statement 2; Furthermore, inflation is often a concern in emerging market countries. To measure an exchange rate between Canada and an emerging market currency that is adjusted for inflation, a real exchange rate should be calculated. Assuming no change in the real exchange rate, the change in an emerging market's asset values in domestic currency will just reflect the emerging market's asset returns in local currency and the difference between inflation rates in the domestic and foreign countries.
Using Owens's analysis, the sensitivity of the Diversified stock returns, measured in Canadian dollars, to changes in the value of the Arbutian currency is closest to:
A. -0.60.
B. 0.40.
C. 1.60.
Answer: B
Explanation:
Explanation/Reference:
Explanation:
Diversified is an exporter, so its stock will likely go up when the value of the Arbutian currency goes down.
The currency depreciation makes the prices of its exports more attractive to foreign customers.
Furthermore, the firm does not import its inputs but obtains them locally, so its costs do not increase as a result of the decrease in the value of the Arbutian currency.
When the Arbutian currency declines by 10%, the value of Diversified stock will increase by 6%.
Diversifieds local currency (Arbutian currency) exposure is thus negative and is -0.6. Using the formula for the domestic currency exposure, the sensitivity of the Diversified stock returns in Canadian dollar terms to changes in the value of the Arbutian currency is:

(Study Session 18, LOS 66.l,m)