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dimulka [17.4K]

2 years ago

12

What is the advantage of a variable-interest loan?

1 answer:

Maksim231197 [3]2 years ago

5 0

Answer:

Borrower can capitalize on a reference rate decrease

Explanation:

Variable interest rate is the floating interest rate, which changes with change in the interest rate given by central bank. It is not fixed it can vary. It might be increased or decreased time to time.

As a borrower Increase in interest rate will result in loss because due to variable nature we need to pay more interest and decrease in interest rate will result in profit because due to variable nature we need to pay less interest

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Dufner Co. issued 15-year bonds one year ago at a coupon rate of 7.1 percent. The bonds make semi-annual payments. If the YTM on

saveliy_v [14]

Answer:

Total $1,173.2544

Explanation:

The price of the bond will be equivalent to the coupon payment and maturity discounted at the YTM

<em><u>Coupon payment PV will be an annuity:</u></em>

$C \times \frac{1-(1+r)^{-time} }{rate} = PV\\$

C 35.50 (1,000 x 7.1% / 2 )

time 30 (15 years x 2 payment per year)

rate 0.027 (YTM /2 )

$35.5 \times \frac{1-(1+0.027)^{-30} }{0.027} = PV\\$

PV $723.5919

<em><u> The maturity will be the present value of a lump sum</u></em>

$\frac{Maturity}{(1 + rate)^{time} } = PV$

Maturity 1,000.00

time 30.00

rate 0.027

$\frac{1000}{(1 + 0.027)^{30} } = PV$

PV 449.66

We add bot h to gett the market value

PV c $723.5919

PV m $449.6625

Total $1,173.2544

3 0

3 years ago

Which of the following is a depository financial institution?

Darya [45]

The answer is "Online Bank"

4 0

2 years ago

Read 2 more answers

Place the components of the M2 money supply in order, from smallest to largest

dimulka [17.4K]

Answer:

Small time deposits, money market mutual funds, currency, checkable deposits, savings deposits.

Explanation:

8 0

2 years ago

Inflation is a decrease in the average price level in the economy.

Rama09 [41]

This is false. When inflation happens, prices go up in the economy.

7 0

3 years ago

Compute the discounted payback statistic for Project C if the appropriate cost of capital is 7 percent and the maximum allowable

Lelechka [254]

The answer i think is rejected because the cash flow is not stable

6 0

2 years ago