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1 year ago

A discount bond is also called a ________ because the owner does not receive periodic payments.

Business

1 answer:

a_sh-v [17]1 year ago

3 0

A discount bond is also called a <u>zero coupon bond</u> because the owner does not receive periodic payments.

A discount bond is a bond that is issued for much less than its par—or face—fee. discount bonds can also be a bond currently trading for less than its face cost inside the secondary market. A bond is considered a deep-cut price bond if it's far bought at a substantially decrease price than the par fee, normally at 20% or more.

A zero-coupon bond is a bond that pays no interest and trades at a reduction to its face price. It is also known as a natural cut price bond or deep cut price bond. U.S. Treasury payments are an example of a 0-coupon bond.

Coupons are the promised hobby payments of a bond, paid periodically till the adulthood date of the bond. The coupon rate determines the quantity of every coupon fee of a bond. The coupon rate, expressed as an APR, is about by using the issuer and said on the bond certificate.

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2 years ago

Banking may be subdivided into at least three categories of banks. Match up the definitions with the appropriate name.

lyudmila [28]

There are different types of banks according to their classification. There are seven major type of banks that exist including retail, corporate, commercial, exchange, industry, cooperative and central.

Explanation:

1. A bank that specializes in retail or consumer banking in a local market.

Commercial Bank

This type of bank is based on shoort term credit and ease of withdrawal.

II. A bank that engages in a complete array of wholesale commercial banking activities and usually also provides retail banking services.

Industrial banks

These banks have large capitals that they invest in commercial activities.

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Central Bank

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4 years ago

A Treasury bill with a par value of $100,000 due three months from today is selling for $96,545. What is its effective annual yi

Andrew [12]

The effective annual yield of the treasury bill will equal 15.55%.

<h3>What is an effective annual yield?</h3>

The effective annual yield means profit or returns that an investor will receive on a bond.

Three months Yield = (Par value - Current value) / Current value

Three months Yield = (100,000 - 96,454) / 96,454

Three months Yield = 0.03676363862

Three months Yield = 3.68%

Effective annual yield = (1+I)^n-1

Effective annual yield = (1+0.0368)^4 - 1

Effective annual yield = 1.15552661809 - 1

Effective annual yield = 0.15552661809

Effective annual yield = 15.55%

In conclusion, the effective annual yield of the treasury bill will equal 15.55%.

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3 years ago

Two external factors which must be considered in pricing decisions are __________. A. the marketing mix and the nature of the m

Nat2105 [25]

Answer:

The correct answer is D. demand and the nature of the market.

Explanation:

External factors: Nature of the market and demand

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3 years ago