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mafiozo [28]
3 years ago
5

The yield to maturity on a coupon bond is _____.(A) always greater than the coupon rate.(B) the rate an investor earns if she ho

lds the bond to the maturity date, assuming she can reinvest all coupons at the current yield.(C) the rate an investor earns if she holds the bond to the maturity date, assuming she can reinvest all coupons at the yield to maturity.(D) only equal to the internal rate of return of a bond when the bond is priced at par.(E) greater than both the current yield and coupon rate when the bond is priced at a premium to par.
Business
1 answer:
Andrej [43]3 years ago
5 0

Answer:

The answer is (C) the rate an investor earns if she holds the bond to the maturity date, assuming she can reinvest all coupons at the yield to maturity.

Explanation:

Yield to maturity is the internal rate of return for investor if he/she holds the bond to maturity. In other words, it is the discount rate that brings net present value of the coupons and principal repayment received from the current time to bond maturity equal to its current bond's price ( thus, assuming all the coupon can be reinvested at the yield to maturity). So, (C) is the correct choice.

(A) is not correct because Yield to maturity can be either higher, lower or equal to coupon rate.

(B) is not correct because the assumption is all the coupons can be reinvested at yield to maturity, not current yield.

(D) is not correct because yield to maturity is the internal rate of return of the bond given the bond is hold until maturity.

(E) is not correct because bond is priced at premium to par when yield to maturity is lower than its coupon rate.

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The price of good B has a pattern such that P = $20 on Monday through Thursday of every week, and P = $25 on Fridays. If specula
Andru [333]

Answer:

The correct answer is D. increase; decrease.

Explanation:

Speculation consists of the purchase (or sale) of goods with a view to their subsequent resale (repurchase), when the reason for such action is the expectation of a change in the prices affected with respect to the dominant price and not the gain derived from its use, or of some kind of transformation carried out on these or of the transfer between different markets.

A speculative operation seeks not to enjoy the good or service involved, but to obtain a benefit from the price fluctuation based on the theory of arbitration. In an extensive sense, every form of investment that a medium entails is speculative; However, the term is usually applied to that investment that does not entail any kind of commitment to the management of the assets in which it is invested, and is limited to the movement of capital (financial market), usually in the short or medium term.

The speculation is based on the forecast and the perception, so that the speculator can also be wrong if he does not correctly anticipate the evolution of future prices, so he will have to sell cheap something he bought expensive. The speculative market therefore rewards those who know how to predict.

3 0
3 years ago
Which of the following is the correct statement about fixed costs? The fixed cost per unit will decrease when volume increases.
Montano1993 [528]

Answer:

The correct statement is: "The fixed cost per unit will decrease when volume increases."

Explanation:

Total fixed costs remain the same within a relevant range, but the <em>fixed cost per unit</em> decreases as production increases, because the same fixed costs are spread over more units produced.

6 0
4 years ago
A store that sells a huge variety of one type of product, such as books, in order to dominate the market for that product is cal
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7 0
4 years ago
One Planters NUT-rition Cranberry Almond Peanut bar weighs 35 grams and is composed of 23% lipid, 57% carbohydrate, 14% protein,
Aloiza [94]

Answer:

C) 42%; 11%

Explanation:

The total calories in one Planters NUT-rition Cranberry Almond Peanut bar =

  • fats: 35 grams x 23% x 9 calories = 72.45 calories
  • carbohydrates: 35 grams x 57% x 4 calories = 79.8 calories
  • proteins: 35 grams x 14% x 4 calories = 19.6 calories
  • total 171.85 calories

percent calories from fat = 72.45 calories / 171.85 calories = 0.4216 x 100 = 42.16% ≈ 42%

percent calories from protein = 19.6 calories / 171.85 calories = 0.1141 x 100 = 11.41% ≈ 11%

6 0
4 years ago
Does this production function exhibit​ increasing, decreasing, or constant returns to​ scale? A. Decreasing returns to scale bec
horsena [70]

Answer: Option A : Decreasing returns to scale because the inputs exhibit diminishing marginal returns.

Explanation:

Return to scale measures the degree of effect certain changes in the input factors(parameters) has on the output in the long run.

Also in simple words, Marginal returns in Economics describes a situation where the increasing the input or intake of a commodity leads to decrease in satisfaction (output).

Hence, for a system that it's input exhibits marginal returns, increasing the input(e.g Capital, Land) leads to decrease in output (satisfaction; Marginal returns parlance) thereby DECREASING the RETURN TO SCALE.

4 0
3 years ago
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