Answer:
large banks whose failure would start a widespread panic in the financial system.
Explanation:
A bank run can be defined as a situation where bank clients or depositors make withdrawals of their money simultaneously from banks as a result of being scared or afraid the depository institution will run out of cash (bankruptcy) and become insolvent.
In order to counter the problem with bank runs, the Federal Deposit Insurance Corporation (FDIC) was established on the 16th of June, 1933.
Furthermore, to avoid bank runs or other financial institutions from being insolvent, the Federal Reserve (Fed) and Central banks (lender of last resort) are readily accessible and available to give monetary funds to these institutions when they're running out of money and as well as regulate their activities.
Hence, the government's too-big-to-fail policy applies to large banks whose failure would start a widespread panic in the financial system.
Answer: i don’t remember this that well but i think u have to add the two numbers
Explanation:
Answer:
If the yield to maturity remains at 8%, then the bond's price will decline over the next year.
Explanation:
When the bonds sells at a premium it means that the coupon payment is greater than the yield to maturity, which means that the income generated by the bond is greater than return required by the investor and because of this the bond sells at a premium because the investor is willing to pay more for the bond as it offers more income than its required rate of return. With a premium the bond price increases to a point where the coupon and required return become equal. When the bond has 10 years to maturity it means that it will give 10 equal payments to the investor which will be greater than the investors required return therefore the investor will be willing to pay a higher price for the bond, as the maturity decreases the number of payments which will be higher than the required return also decrease, so for example if there are 5 years to maturity then the bond will pay 5 payments that are greater than the required return so the investor will be paying a lower premium compared to when he was getting 10 payments that payed more than his required return.
The profitability index decision rule of the project equals 2.45 year and thus, the project should be accept to be embarked on.
<h3>What is a
profitability index?</h3>
The rule refers to a decision-making exercise that helps to evaluate whether to proceed with a project based on its profitability.
Hence, because the profitability index decision rule of the project equals 2.45 year and thus, the project should be accept to be embarked on.
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Governments implement Administrative trade policies that are designed to make it difficult for imports to enter a country.
<h3>What is Administrative Trade Policies?</h3>
Administrative trade policies are bureaucratic rules designed to make it difficult for imports to enter a country. These are rules and regulations made by the government to control the entry of particular products into the country.
<h3>What is Trade policy ?</h3>
Trade policy is the set of agreements, regulations, and practices by a government that affect trade with foreign countries. Each nation determines its own standards for trading, including its tariffs, subsidies, and regulations.
Trade policies have a significant effect on the international economy and on financial markets. They affect exchange rates, the availability of goods, and the prices that people pay for them, among many other economic factors.
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