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garri49 [273]
2 years ago
7

Economic activity in developing countries is limited at least in part due to limited investment. Investment is limited mostly du

e to insufficient lending. Lending is mostly limited due to economic uncertainty and the prospect of unexpected inflation.
In light of this, please describe how a lender can lose during inflation if the inflation is unanticipated and the loan is a fixed-interest-rate loan.
How would a variable-interest-rate loan (one that adjusts over the contract period) eliminate these losses?
Business
1 answer:
Tpy6a [65]2 years ago
4 0

Inflation is the economic condition in which the interest rate keeps increasing which is beneficial for the lenders. But not a fixed rate lender.

<h3 /><h3>What is Interest Rate?</h3>

Interest rate is the prevailing market rate which the lender of the money gets in return for the money provided as a loan.

If there is a fixed interest contract the lender will get the same percentage of return for the duration of contract, no matter the fluctuation of the interest rate in the market. This is not beneficial when the economy is facing inflation. As whatever be the rate in the market (definitely higher) the lender will get the same percentage of return.

However if there is a variable rate contract the rate is updated and the lender is paid at the updated interest rate. This is beneficial when the economy is facing inflation.

Learn more about interest rates at brainly.com/question/28142837

#SPJ1

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Redesigned Computers has 6.2 percent coupon bonds outstanding with a current market price of $604. The yield to maturity is 14.4
DochEvi [55]

Answer:

These bonds mature in 8 years

Explanation:

We are required to find the Number of Years that the Bonds  will mature. Thus we want to find N

Using A financial Calculator

PV    = $604

YTM = 14.4 %

PMT = $1,000 × 6.2 % = 62

FV    = $ 1000

P/YR = 1

N   = ?

N = 8.837

Therefore these bonds mature in 8 years

5 0
3 years ago
an employee believes that the performance appraisal was unfairly influenced by a drug error that the employee committed several
notsponge [240]

The phenomenon experienced by the client when he believed that the performance appraisal was unfairly influenced by a drug error that the employee committed several weeks ago, is called the Horns Effect.

<h3>What is the Horns Effect?</h3>

The Horns Effect is a rater bias property in performance appraisal at workplace. It is a tendency for a single negative attribute to influence the rater to mark everything on the lower side of the scale. It is a bias that makes them think that one bad attribute seems to spoil the bunch.

It is the exact opposite of Halo Effect and makes decision making challenging. Horns Effect may lead to unfair sanctions or inappropriate dismissal of the employee.

To know more about Horns Effect, visit:

brainly.com/question/988504

#SPJ4

8 0
2 years ago
If you wanted to make sure a company has enough money available to pay its bills, which financial statement would be most helpfu
LenaWriter [7]

Answer:

D. Cash flow statement

Explanation:

A cash flow statement refers to a financial statement which is used to record and summarize the amount of liquid assets (cash and cash equivalents) entering and leaving a business entity.

Cash flow can be defined as the net amount of cash and cash-equivalents that is flowing into (received) and out (given) of a business. There are three components of the cash flow;

1. Operating cash flow: all cash generated from the business activities of an organization.

2. Financing cash flow: all payments made by an organization and profits from issuance of debts and equity.

3. Investing cash flow: costs associated with purchasing of capital assets and investments of cash resources in other businesses.

Hence, if you want to make sure a company has enough money available to pay its bills, the financial statement which would be most helpful is the cash flow statement because it is used to measure and analyze how well the company is doing financially in terms of generating revenue to pay its bills and debts.

5 0
3 years ago
If the sellers bid against each other for the right to sell the good to a consumer, then the producer surplus will be $0 or slig
erica [24]

Answer:

$50 or slightly less

Explanation:

If we assume that there is four persons namely E, S, A and K

The producer surplus is the surplus that shows the difference between the seller value and the seller cost

In the case when the seller bid against each other so here the producer surplus would be $100 or slightly less

Here only one person could able to send the good i.e. person E As the cost to the person would be lowered by the goods value

Therefore the option B is correct

4 0
3 years ago
Jamie is looking for a new job. she used to be the top sales representative for the region and was expecting to be promoted. how
puteri [66]

Jamie's dissatisfaction with her current job stems from a breakdown in the performance-reward. Although Jamie is a top performer for her region, she did not receive the promotion so it hurt her because she thought she'd get it due to her excellent performance. She thought she'd get promoted based on performance but when that didn't happen, she was dissatisfied.

8 0
3 years ago
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