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lukranit [14]
3 years ago
9

Suppose 2-year treasury bonds yield 4.5%, while 1-year bonds yield 3%. r* is 1%, and the maturity risk premium is zero. using th

e expectations theory, what is the yield on a 1-year bond 1 year from now? calculate the yield using a geometric average.
Business
1 answer:
Gemiola [76]3 years ago
5 0
<span>The expectation theory assumes that the yield curve accurately reflects the expected value of interest rates. b. Inflation is 4.5%-3%=1.5%-1%=0.5% in year one. Year two would be 1.5%.</span>
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Which should Jill do to increase her credit score?
marshall27 [118]

Answer:

Pay off her credit card debt.

Explanation:

A credit score is indicative of one's history of loan repayments.  A high credit score communicates that the borrower has been timely in paying their loans.  It tells that an individual has been responsible when using credit facilities.

A low credit score says that the customer is often late in repaying their loans. If Jill wants to improve his credit score, he should clear all his outstanding debts.

6 0
2 years ago
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Suppose that a pharmaceutical company wants to grow in size but is constrained in the short run by its production capacity. What
Natasha_Volkova [10]

Answer:

Build more factories, Expand the size of current factories, Use cheaper materials

Explanation:

Long run is not a precise period of time thereby meaning it could span from a year to eternity, which is adequate time to plan and grow. Building more factories will increase the growth in size for the capacity for  more production as well as expanding the size of the current factories. Due to the fact that there is a constraint of production capacity the company should look for alternatives in production technology in the long run so as to reduce cost of materials  but with the same production quality.

6 0
3 years ago
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The United Kingdom currently has a trade deficit with New Zealand. If the U.K. pound sterling appreciates relative to the New Ze
monitta

The correct answer to the given question is that the trade deficit would increase since with the appreciating pound means <em>more goods will be imported</em> from New Zealand.

Based on the given question, we are asked to show the effects of the trade deficit between New Zealand and UK based on the appreciation of the pound sterling relative to the New Zealand dollar.

With this in mind, we are aware that when there is a strong domestic currency, then it would encourage more imports and hamper exports, therefore, the trade deficit will increase, since an appreciating pound means more goods will be imported from New Zealand.

Therefore, the correct answer is option D

Read more about trade deficit here:

brainly.com/question/24473707

4 0
2 years ago
Two goods are considered to be related goods by many buyers: if the price of one increases, buyers buy more of the other. This i
vovikov84 [41]

Answer: False.

Explanation:

False.

This indicates that the two goods are substitute goods, not the complementary goods.

In case of complementary goods, the price of one good is inversely related with the demand for other related good. For example, car and petrol; if the price of petrol increases as a result demand for cars decreases.

In case of substitute goods, the price of one good is directly related with the demand for other related good. For example, tea and coffee; if the price of coffee increases as a result demand for tea increases. So, there is a positive relationship between the price of one good and demand for the other good.

3 0
2 years ago
True or False: In the event of the firm's bankruptcy, the most shareholders can lose is their original investment in the firm's
KATRIN_1 [288]

Answer:

The answer is true.

Explanation:

Preference or preferred shareholders are synonymous to lenders to a business or company. Preferred shares are like debt to a business. They possess the characteristics of both debt and equity and in the case of liquidation, they have to be settled first. Common shareholders are the last shareholders to settled.

3 0
2 years ago
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