The gdp price index equals?

The ________ of the term structure states the following: the interest rate on a long-term bond will equal an average of short-te

rjkz [21]

Answer:

liquidity premium theory

Explanation:

The liquidity premium theory states that those that invest in bonds do prefer high liquid as well as securities that are short-dated so that it can be sold fast compare to long-dated ones. It states that investors do get compensation for higher default risk when there is change in interest rate.

It should be noted that The liquidity premium theory of the term structure states the following: the interest rate on a long-term bond will equal an average of short-term interest rates expected to occur over the life of the long-term bond plus a term premium that responds to supply and demand conditions for that bond.

7 0

2 years ago

If ending accounts receivable exceeds the beginning accounts receivable Group of answer choices cash collections during the peri

sukhopar [10]

Answer:

no cash was collected during the period

or

cash collections during the year are less than the amount of revenue recognized

Explanation:

For example if we had Accounts receivable beginning balance $ 250,000 and Sales of $ 500,000 are made on accounts then the Total Accounts receivable will be $ 750,000.

But out of the $ 500,000 sales only $300,00 cash is collected and the remaining $ 200,000 is still in the Accounts receivable balance so the ending Accounts receivable balance will be $ 250,000 + $200,000 = $ 450,000 which will be greater than beginning Accounts receivable balance.

So there are two possibilities either cash collections during the year are less than the amount of revenue recognized.

or

no cash was collected during the period.

Similarly it cannot be choice no 1 : collections during the period exceed the amount of revenue recognized

Because if more cash is collected then ending account receivable balance would be less than the beginning account receivable balance.

Choice no 3 is also wrong if cash collections are more than the ending accounts receivable balance would be less

4 0

3 years ago

Buyers and sellers in a competitive market that must accept the price that the market determined.

taurus [48]

Answer:

price takers

Explanation:

The buyers and sellers that just accept the prices are called price takers-

6 0

2 years ago

Mills Corporation acquired as an investment $260 million of 6% bonds, dated July 1, on July 1, 2021. Company management is holdi

aleksandrvk [35]

Answer:

1.

Dr Investment in Bonds 260

Dr Premium on Investment in Bonds 40

Cr Cash $300

2.

Dr Cash$7.8

Cr Premium on Investment in Bonds $1.8

Cr Interest Revenue $6

3.

Dr Investment in bonds $260

Dr Premium on Investment in Bonds $40

Dr Premium on investment in Bonds -$1.8

Cr Carrying Value $298.2

4.

Dr Cash $314

Dr Premium on Investment in Bonds $40

Dr Premium on investment in Bonds amortized -$1.8

Dr Investment in bonds $260

Cr Gain due to investment sale $15.8

( $260+$40-1.8)-314

Explanation:

Mills Corporation Journal Entry ( $ million)

1.

Dr Investment in Bonds 260

Dr Premium on Investment in Bonds 40

(300 -260)

Cr Cash $300

2.

Dr Cash

($260 million X 6% / 2) $7.8

Cr Premium on Investment in Bonds $1.8

Cr Interest Revenue

($300 million X 4% / 2) $6

3.

Dr Investment in bonds $260

Dr Premium on Investment in Bonds $40

Dr Premium on investment in Bonds -$1.8

Cr Carrying Value $298.2

($260+$40-$1.8

4.

Dr Cash $314

Dr Premium on Investment in Bonds $40

Dr Premium on investment in Bonds amortized -$1.8

Dr Investment in bonds $260

Cr Gain due to investment sale $15.8

( $260+$40-1.8)-314

8 0

3 years ago

Mallory hires Raghav to work for one year as an assistant manager at $5,500 per month, reserving the right to cancel the contrac

amid [387]

Answer: No, because Mallory and Raghav are not bound by the contract.

Explanation: Being bound by a contract entails being linked to a written agreement, the breaching of which could result in consequences lying with the person who breached the contract. However when this contract was entered into, there was a clause that allowed the parties to cancel the contract at any time. When Mallory fired Raghav the contract was subsequently cancelled, making the contract null and void (non - existent). This means that Raghav is not entitled to the outstanding 10 months' salaries.

7 0

3 years ago