C. Provide objective evidence that a transaction has taken place.
Answer:
Explanation:
Yield on 1 year trasury bond: r1=4.25+3.5 = 7.75%
Now, yield is r3 = 7.75+1.5 = 8.25%
r3=r*+inf
8.25=3.5+inf
inf=4.75%
4.75 = (4.25+i+i)/3
14.25 = 4.25 +2i
2i = 10
i = 5%
Inflation expected after year 1 is 5%
You want your hand to "give" a bit when you catch the ball. You don't want want the ball to come to a hard stop because that would risk hurting your hand.
Answer:
The correct answer is C.
Explanation:
Giving the following information:
Cochrane Associate's net sales last year were $525 million. If sales grow at 7.5% per year, how large (in millions) will they be 8 years later?
We need to use the following formula:
FV= PV*(1+i)^n
FV= 525*(1+0.075)^8
FV= $936.33