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2 years ago

Is there a relationship between a financial asset and its interest rate? the interest rate on a financial asset _______

1 answer:

4 0

The cost of a financial asset and its interest rate are inversely correlated. An investment's interest rate decreases as its value increases. Similar to this, an asset's price increases when its interest rate decreases.

Thus, there is an inverse relationship between financial assets and their interest rate.

<h3>What Is a Financial Asset? </h3>

A financial asset is a liquid asset with value derived from a legal claim to ownership or a contractual right. Financial assets include, among other things, cash, investments in stocks, bonds, mutual funds, and bank deposits.

Assets that facilitate the movement of money. They move money from those who have extra money to those who have not, whether they are people, businesses, or even the government.

A promise or claim on future money is what financial assets are. A financial asset or liability is first valued at fair market value. The type of financial instrument will determine how the subsequent measurement is done. The amortized cost and fair value are both used to measure various categories.

For more information about Financial Asset refer to the link:brainly.com/question/15071910

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g Cole Co. began constructing a building for its own use in January 2021. During 2021, Cole incurred interest of $50,000 on spec

slava [35]

Answer: $40,000

Explanation:

Interest that is accrued as a result of a building should be capitialized to the cost of that building. The amount of interest payment that is due to the building will simply be the interest payment that the company would have avoided incurring had it not undertaken the construction of the building.

This amount is represented by the interest computed on the weighted-average amount of accumulated expenditures which in this case is $40,000 so that is the amount that should be capitalized by Cole Co.

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3 years ago

Galaxy Co. distributes wireless routers to Internet service providers. Galaxy procures each router for $75 from its supplier and

swat32

Answer:

Simulation results:

- the average monthly profit resulting from its policy of stocking 100 routers at the beginning of each month is $4237.

- percentage of total demand is satisfied: 92%.

Explanation:

We have to consider three factors to calculate the profit:

Sales. Every unit sold adds (125-75)=$50 to the profit. We have to consider the condition that the maximum amount of units that can be sold is 100 units.
The remains cost. If the monthly demand is under 100 units, the profit is reduced by $15 per each remaining unit.
The shortage cost. For each unit demanded that exceeds the 100 units, the profit is reduced by $30.

The equation can be expressed as:

$Profit=50*Max(Q;100)-15*Max(100-Q;0)-30*Max(Q-100;0)$

A simulation with 10,000 trials is done, and the average monthly profit calculated for this policy is $4237.

The demand was calculated with the Excel function INT(NORMINV(RAND(),100,20)), to mimic a normal distribution with mean 100 and standard deviation 20.

b) The satisified demand is calculated for each trial as the minimum value between Q (quantity demanded) and 100, as if Q is bigger than 100, only 100 units of the demand are satisfied.

The percentage of total demand satisfied is:

$\%Satisfied=\dfrac{Q_{satisf}}{Q}=\dfrac{918759}{997005}=0.9215=92\%$

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3 years ago

Suppose People's bank offers to lend you $10,000 for 1 year on a loan contract that calls for you to make interest payments of $

I am Lyosha [343]

The correct answer is 10.38%

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3 years ago

The postal service of St. Vincent, an island in the West Indies, obtains a significant portion of its revenues from sales of spe

klemol [59]

Answer:

It is more profitable to maintain the price at $10

Explanation:

Giving the following information:

The souvenir sheets cost the postal service $1.15 each. St. Vincent has been selling these souvenir sheets for $10.00 each and ordinarily sells about 61,000 units. To test the market, the postal service recently priced a new souvenir sheet at $11.00 and sales dropped to 51,000 units.

We need to calculate the actual revenue and decide whether it is more convenient to increase the price or leave it as it is.

Actual revenue= 61,000 units* (10 - 1.15)= $539,850

New revenue= 51,000 units*(11 - 1.15)= $502,350

It is more profitable to maintain the price at $10

8 0

3 years ago

Since bond market values are expressed as a percentage of their bond value, a $1,000 bond that is being sold at 93 would be trad

Sophie [7]

Answer: $930

Explanation:

From the question, we are informed that bond market values are expressed as a percentage of their bond value and are further told that a $1,000 bond that is being sold at 93.

Therefore, the bond will be trading at:

= $1000 × 93%

= $1000 × 0.93

= $930

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3 years ago