1. Hastings Entertainment has a beta of 0.39. If the market return is expected to be 15.60 percent and the risk-free rate is 7.60 percent, what is Hastings’ required return?
2. What is the problem with using PPP to predict FX rates in the short- run?
3. If the inflation rate in the US is 3% and 0% in Japan, what should happen to the $US/Yen in % terms?