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Zina [86]
3 years ago
6

You own a fixed-income asset with a duration of five years. If the level of interest rates, which is currently 8%, goes down by

10 basis points, how much do you expect the price of the asset to go up (in percentage terms)
Business
1 answer:
I am Lyosha [343]3 years ago
5 0

Answer:

0.4629%

Explanation:

Given:

Duration of fixed assets (D) = 5 year

Interest rate (r) = 8% = 8/100 = 0.08

Decrease in Interest rate point(ΔY) = 10 basis = 10/100 = 0.01%

Computation:

D* = D / (1 + r)

D* = 5 / (1 + 0.08)

D* = 5 / 1.08

D* = 4.6296

Computation:

ΔP/P = D* × ΔY

= 4.6296 × 0.01%

= 0.4629%

Therefore, Price of the assets go up to 0.4629%.

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Bebe Rexha has AGI of $100,000 and makes the following expenditures:
shutvik [7]

Answer:

$31000 will be allowed as expenditure

Explanation:

given data

Wheelchair  = $10,000

Whirlpool bath = $10,000

Maintenance =  $1,000

Increased utility bills =  $1,000

various home modifications = $10,000

solution

as here value of the home increased =  $1000

and that is  increaed utility bill of the whirlpool

so that expenditure will be added to value of asset

so  

total expenditure is = $10000 + $10000 + $10000 + $1000 =  $31000

so $31000 will be allowed as expenditure

7 0
3 years ago
The price of a competitive firm's product is $50 per unit. The firm currently has marginal cost equal to $40. To maximize profit
Karo-lina-s [1.5K]

Answer:

should increase its output

6 0
2 years ago
A company must repay the bank a single payment of $20,000 cash in 3 years for a loan it entered into. The loan is at 8% interest
Yuki888 [10]

Answer:

Present Value of the loan = $19999.36 rounded off to $20000

Explanation:

The present value of loan will comprise of the present value of the principal amount of loan plus the present value of the interest that the loan will charge for the 3 year time period for which it is outstanding. As the interest payments are fixed and occur after equal intervals of time, they are considered an annuity.

To calculate the present value of the loan, we must discount the interest payments using the present value factor of annuity given in the question as 2.5771 and we must discount the principal to present value using the present value factor given in question as 0.7938.

We will first calculate the annual interest payment on loan.

Annual Interest payment = 20000 * 0.08 = 1600

Present value of the Interest payment - annuity = 1600 * 2.5771

Present value of the Interest payment - annuity = $4123.36

Present value of the Principal loan = 20000 * 0.7938

Present value of the Principal loan = $15876

Present Value of the loan = 15876 + 4123.36

Present Value of the loan = $19999.36 rounded off to $20000

7 0
2 years ago
The managerial role of a ________ is best described as giving direct command and orders to subordinates
Andrews [41]

The managerial role of a <u>leader </u>is best described as giving direct command and orders to subordinates

<h3>What is the function of management ?</h3>

The pursuit of organizational goals efficiently and actually by including the work of people through planning, organizing, leading, and controlling. This process of management involves monitoring performance, reaching it with goals, and making adjustments if needed.

<h3>What are the distinctions among the three levels of management?</h3>

The three levels of management in most communities are top-level management, mainly responsible for overseeing all functions, middle-level management, responsible for executing plans and procedures, and low-level control, responsible for direct task performance and deliverables.

To learn more about  organizational goals, refer

brainly.com/question/17601805

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4 0
2 years ago
Suppose that the # of Employed = 160 million, # of Unemployed = 10 million, and the Adult Civilian Population = 250 million. In
PIT_PIT [208]

Answer:

labor force participation rate = 68%

employment to adult civilian population ratio = 64%

Explanation:

total number of employed people = 160 million

total number of unemployed people = 10 million

total adult population = 250 million

total labor force = 170 million

labor force participation rate = total labor force / total adult population = 170 million / 250 million = 68%

employment to adult civilian population ratio = total number of employed people / total adult population = 160 million / 250 million = 64%

8 0
3 years ago
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