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Semenov [28]
3 years ago
11

A Treasury bond due in one year has a yield of 5.7%; a Treasury bond due in 5 years has a yield of 6.2%. A bond issued by Ford d

ue in 5 years has a yield of 7.5%; a bond issued by Shell Oil due in one year has a yield of 6.5%. The default risk premiums on the bonds issued by Shell and Ford, respectively, are:__________. a. 1.0% and 1.2% b. 1.2% and 1.0%. c. 0.7% and 1.5%. d. 0.8% and 1.3%.
e. None of the options are correct
Business
1 answer:
SVETLANKA909090 [29]3 years ago
7 0

Answer:

d. 0.8% and 1.3%.

Explanation:

The default risk premiums on the bonds issued by Shell = 6.5% - 5.7% = 0.8%

The default risk premiums on the bonds issued by Ford = 7.5% - 6.2% = 1.3%

Hence, the default risk premium issued by Shell and Ford respectively are 0.8% and 1.3%

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Nancy's lease deed clearly states that she will have to pay $1,250 as rent per month and $2,000 as a one-time payment to secure
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Answer:

Security Deposit

Explanation:

Security deposit is the correct answer because this is the amount that has been considered by the owner when there is any damage occurs. This amount is paid initially which is more than the monthly payment and refundable when the agreement finishes. In the given question it can be clearly seen that the security money is more than monthly payment of $2000.

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3 years ago
Which of the following is not a need-based source of financial aid
yanalaym [24]
B. athletic scholarship
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Jack has a ticket to see Bo Bice for which he paid $30 yesterday. He takes an unpaid day off from work to get ready for the conc
valentina_108 [34]

Answer:

$70

Explanation:

The opportunity cost is the value in which the advantage is produced from the options available. The best gain is term as the opportunity cost

In the question, it is given that the offered price is $70 and the yesterday price is $30 which was paid which terms as a sunk cost. This cost is not useful for decision making as well as for computing the opportunity cost also

So, only $70 would be considered

3 0
3 years ago
Price serves the function of _____ for goods, services, and financial resources.
Blababa [14]
Allocator- Price thus serves the function of allocator. First, it allocates goods and services among those who are willing and able to buy them. (As we noted in Chapter 1, the answer to the economic question “For whom to produce?” depends primarily on prices.) Second, price allocates financial resources (sales revenue) among producers according to how well they satisfy customers’ needs. Third, price helps customers to allocate their own financial resources among various want-satisfying products.
7 0
3 years ago
You are a U.S.-based treasurer with $1,000,000 to invest. The dollar-euro exchange rate is quoted as $1.60 = €1.00 and the dolla
kotykmax [81]

Answer: An astute trader can make $ 41,666.66.

Explanation: You must first change

$ 1,000,000 per pounds, which would leave a total of £ 500,000. ($ 1,000,000 / 2.00 = £ 500,000;).

Secondly spend £ 500,000 to euros, obtaining € 600,000 (£ 500,000 x 1.20 = € 600,000;).

Thirdly, with euros, buying dollars again, obtaining $ 960,000 (€ 600,000 x 1.60 = $ 960,000), that is, an arbitrage loss of -40,000 in relation to the initial investment.

Finally you must return in the opposite direction:

$ 1,000,000 / 1.6 (€) / 1.2 (£) * 2 - $ 1,000,000 = $ 41,666.66 that is, an arbitrage profit.

4 0
3 years ago
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