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Bond [772]
3 years ago
15

1. Given the nominal interest rate of 17​% and the expected inflation of 13​%, then the value of the real interest rate is ___ ?

Business
1 answer:
Veronika [31]3 years ago
6 0

Answer:

According to fisher equation

(1+nominal Interest rate)=(1+real interest rate)(1+inflation)

1) So 1.17=(1+R)(1.13)

1+R=1.17/1.13

R=1.035-1

R=0.0353

Real interest rate = 3.53 percent

2) (1+NIR)= 1.03*1.04

  1+ NIR= 1.072

NIR= 0.072

Nominal interest rate = 7.2 percent

A lender prefers a higher real interest rate as he will earn more money on the amount he has lend if the real interest rate is higher.

A borrower will prefer a lower real interest rate as he will have to pay lower interest payments on an amount if the real interest rate is lower.

Explanation:

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You purchased an annual interest coupon bond one year ago that had six years remaining to maturity at that time. The coupon inte
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Answer:

The correct answer to the following question will be "8%".

Explanation:

The given values are:

Number of years of maturity = 5 years

Interest rate of coupon = 10%

                           = 10%×1000

                           = 100

Yield to maturity, YTM = 8%

As we know,

Price of Bond = PV of Coupons + PV of Per Value

On putting the values in the above formula, we get

⇒                     = \frac{100\times (1-(1+8 \ percent^{-5}))}{8 \ percent} +\frac{1000}{1+8 \ percent^{5}}

⇒                     = 1079.85

After 1 years, we get

Price of Bond = PV of Coupons + PV of Per Value

On putting the values in the above formula, we get

⇒                     = \frac{100\times (1-(1+8 \ percent^{-4}))}{8 \ percent} +\frac{1000}{1+8 \ percent^{4}}

⇒                     = 1066.24

Now,

The total return rate = \frac{(1066.24-1079.85+100)}{1079.85}

                                   = \frac{86.39}{1079.85}

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7 0
3 years ago
The bookkeeper at Jefferson Company has not reconciled the bank statement with the Cash account, saying, "I don't have time." Yo
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The April ledger accounts for cash showed  is :

JEFFERSON COMPANY

Bank Reconciliation, April 30, Current Year

Company's Books Bank Statement

Ending balance per cash account   26100 Ending balance per bank statement   23690

Additions:     Additions:    

Interest collected 1320   Deposits in transit 7200  

         

   1320     7200

   27420     30890

Deductions:     Deductions:    

NSF—A. B. Wright 270   Outstanding checks 3800  

Bank charges 60        

   330     3800

Correct cash balance   27090 Correct cash balance   27090

 2    

 General Journal Debit Credit

1 Cash 1320  

       Interest revenue   1320

     

2 Accounts Receivable—A. B. Wright 270  

         Cash   270

     

3 Bank service charge expense 60  

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 3    

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In accounting, a well-known ledger is used to file all of an agency's transactions. inside a general ledger, transactional data is organized into assets, liabilities, sales, fees, and proprietor's equity. After each sub-ledger has been closed out, the accountant prepares the trial stability.

Ledger wallets are USB storage devices that hold more than one currency offline. It shops your non-public keys on the tool, making it tough for online hackers to get admission to your bills. If the bodily tool is stolen, customers depend upon a 24-word backup recovery word to get the right of entry to saved cryptocurrencies.

Learn more about  ledger here brainly.com/question/24835236

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