1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
belka [17]
4 years ago
8

You have determined the following data for a given bond: Real risk-free rate (r*) = 3%; inflation premium = 8%; default risk pre

mium = 2%; liquidity premium = 2%; and maturity risk premium = 1%. What is the nominal risk-free rate, rRF?
a. 10%
b. 13%
c. 11%
Business
1 answer:
vagabundo [1.1K]4 years ago
4 0

Answer: 16%

Explanation:

Interest rate on long term treasury securities is calculated below using following formula:

Interest rate = Real risk-free rate + inflation premium + default risk premium + liquidity premium + maturity risk premium

= 3% + 8% + 2% + 2% + 1%

= 16%

Interest rate on long term treasury securities is 16%.

You might be interested in
Cost of goods sold is obtained from _________.
sweet [91]

Answer:

D) the finished goods inventory records.

7 0
4 years ago
Read 2 more answers
High government expenditures can lead to a bigger
REY [17]

Answer:

deficit.

Explanation:

The term deficit describes the scenario where government expenditures exceed the projected revenues.  It is when the government intends to spend more money than it can raise.  Therefore, a deficit is when the government expenses are more than the revenue collected.

Defic contrasts with a surplus, which is a situation where revenues exceed expenses. The government borrows from the domestic and international markets to cover the shortfall associated with a

4 0
3 years ago
Read 2 more answers
What is home trade businness​
Margaret [11]

Answer:

Home trade is the buying and selling of goods (with the aim of making profit) among people of the same country.

Explanation:

6 0
3 years ago
Read 2 more answers
g Profit margins tend to peak during the growth stage of the Product Life Cycle. This is due to ___________________.this being t
DIA [1.3K]

Answer:

Declining unit manufacturing costs while prices can remain high.

Explanation:

A product life cycle can be defined as the stages or phases that a particular product passes through, from the period it was introduced into the market to the period when it is eventually removed from the market.

Generally, there are four (4) stages in the product-life cycle;

1. Introduction.

2. Growth.

3. Maturity.

4. Decline.

Generally, the growth stage is the stage where the product gains acceptance from the consumer and there is a significant increase in demand and sales.

Profit margins tend to peak during the growth stage of the Product Life Cycle. This is due to declining unit manufacturing costs while prices can remain high because the product has been accepted in the market and its unit cost of production is lesser i.e they are manufactured in bulk.

5 0
3 years ago
A farmer purchased a module builder for $50,000. The bank is willing to loan him $37,000. The terminal value of this investment
Allisa [31]

Answer:

the after tax terminal value would be $14,500

Explanation:

6 0
3 years ago
Other questions:
  • In one week, you could read two books or see four movies. The opportunity of cost of choosing to read one book is?
    7·2 answers
  • What is the basis for​ trade? A. Absolute advantage. B. Available resources. C. Efficiency. D. Comparative advantage. E. Economi
    11·1 answer
  • Dallas Company uses a job-order costing system. The company's executives estimated that direct labor would be $4,800,000 (160,00
    9·1 answer
  • Name three rules for creating an effective presentation to summarize a pi team's activities
    8·1 answer
  • Most of the late nineteenth-century business tycoons began their careers in poverty or lower class circumstances. Group of answe
    14·1 answer
  • Crane Company issues $310,000, 20-year, 7% bonds at 102. Prepare the journal entry to record the sale of these bonds on June 1,
    12·2 answers
  • Andrea and Karl got married a year ago and are ready to move out of their apartment and into a new home. After looking at severa
    6·1 answer
  • At a price of $1.00, a local coffee shop is willing to supply 100 cinnamon rolls per day. At a price of $1.20, the coffee shop w
    14·1 answer
  • A two-year bond with par value $1,000 making annual coupon payments of $80 is priced at $1,000.What will be the realized compoun
    15·1 answer
  • How much of the FCF did Rhodes use for each of the following purposes: after-tax interest, net debt repayments, dividends, net s
    15·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!