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3 years ago

I. Explain the termexcess demand.

Business

1 answer:

sladkih [1.3K]3 years ago

3 0

Answer:

economics a situation in which the market demand for a commodity is greater than its market supply, thus causing its market price to rise.

Explanation:

this is the definition. hope this helps.

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Bond P is a premium bond with a coupon rate of 10 percent. Bond D has a coupon rate of 5 percent and is currently selling at a d

mezya [45]

Answer:

Stock P's current yield = 8.18%

Stock D's current yield = 5.87%

Stock P's capital gains yield = -1.31%

Stock D's capital gains yield = 1.4%

Explanation:

price of bond P:

0.07 = {100 + [(1,000 - MP) / 10]} / [(1,000 + MP) / 2]

0.07 x [(1,000 + MP) / 2] = 100 + [(1,000 - MP) / 10]

0.07 x (500 + 0.5MP) = 100 + 100 - 0.1MP

35 + 0.035MP = 200 - 0.1MP

0.135MP = 165

MP = 165 / 0.135 = $1,222.22

price of bond D:

0.07 = {50 + [(1,000 - MP) / 10]} / [(1,000 + MP) / 2]

0.07 x [(1,000 + MP) / 2] = 50 + [(1,000 - MP) / 10]

0.07 x (500 + 0.5MP) = 50 + 100 - 0.1MP

35 + 0.035MP = 150 - 0.1MP

0.135MP = 115

MP = 115 / 0.135 = $851.85

current yield = dividend / stock price

Stock P's current yield = 100 / 1,222.22 = 8.18%

Stock D's current yield = 50 / 851.85 = 5.87%

price of bond P in one year:

0.07 = {100 + [(1,000 - MP) / 9]} / [(1,000 + MP) / 2]

0.07 x [(1,000 + MP) / 2] = 100 + [(1,000 - MP) / 9]

0.07 x (500 + 0.5MP) = 100 + 111.11 - 0.111MP

35 + 0.035MP = 211.11 - 0.111MP

0.146MP = 176.11

MP = 176.11 / 0.146 = $1,206.23

price of bond D in one year:

0.07 = {50 + [(1,000 - MP) / 9]} / [(1,000 + MP) / 2]

0.07 x [(1,000 + MP) / 2] = 50 + [(1,000 - MP) / 9]

0.07 x (500 + 0.5MP) = 50 + 111.11 - 0.111MP

35 + 0.035MP = 161.11 - 0.111MP

0.146MP = 126.11

MP = 126.11 / 0.146 = $863.77

capital gains yield = (P₁ - P₀) / P₀

Stock P's capital gains yield = (1,206.23 - 1,222.22) / 1,222.22 = -1.31%

Stock D's capital gains yield = (863.77 - 851.85) / 851.85 = 1.4%

6 0

3 years ago

On a bank's T-account, which are part of the banks liabilities? a. neither deposits made by its customers nor reserves b. both d

Novay_Z [31]

Answer:

D. deposits made by its customers but not reserves

Explanation:

According to the conceptual framework of the International Financial Reporting Standards (IFRS), a liability is an obligation, a present obligation as a result of past transaction, the settlement of which future economic benefits are expected to flow out from the entity or result in a reduction in the assets of the entity.

The focus is on the word 'obligation'.

As such, when customers make deposit in a bank, the obligation (liability) of the bank increases as the funds deposited remain that of the customer and the bank is obliged to pay the customer whenever the customer demands the funds.

The bank usually sends the customer a credit alert which is a snapshot of the banks position with the customer. This credit alert tells the customer that the liability of the bank has increased as a result of the deposit made by the customer.

A reserve on the other hand, is a retention of profit from previous financial periods. A reserve is usually added under capital in the statement of financial position as an increase in equity, thus a reserve is not a liability.

I hope this helps you understand the question better and you can solve similar questions

4 0

4 years ago

What retirement plans rely on the power of compound

Julli [10]

The plans are that when you retire they would put your money in your accont give you a medical plan and split things equaly wend you die but they would split it up to your wife and kids plz mark brainliest and give thans

5 0

4 years ago

A sales manager learns of the new specifications for the latest TITAN. How does she know if it is permissible to tell a customer

WARRIOR [948]

Answer:

• If the information has been made public

• If Nissan gives a written permission to discuss the information

Explanation:

From the question, we are informed that a sales manager learns of the new specifications for the latest TITAN. To know if it is permissible to tell a customer about them, she'll have to find out whether the information regarding the titan has been made public and also if Nissan has given a written permission to discuss the information.

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3 years ago

Which theory would most likely explain why a commercial bank, which usually focuses on short-term securities, would switch to lo

den301095 [7]

Answer:

preferred habitat

Explanation:

According to the preferred habitat theory, if the expected returns from investment of a particular investment maturity is large enough, investors would shift from their preferred maturities.

In this question, there is a shift from the preferred maturity (short-term securities) to a long-term securities when interest rate changes

The pure expectations theory assumes that bonds of any maturity are perfect substitutes for each other. For example, if an investor buys a 10 year bond and holds it for 1 year, the return is the same as buying a 1 year bond. The theory also assumes that risk premium does not exist and a security only earns its risk free rate

Liquidity premium theory states that risk premium increases with the maturity of a bond. The theory predicts that the yield curve is upward sloping due to liquidity premium

According to the segmented market theory, each bond maturity segment can be thought of as a segment market in which yield are a function of the demand and supply for funds in that maturity.

5 0

3 years ago

I. Explain the termexcess demand.​

I. Explain the termexcess demand.