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
damaskus [11]
3 years ago
14

Suppose the rate of return on a 10-year T-bond is 4.05%, the expected average rate of inflation over the next 10 years is 2.0%,

the MRP on a 10-year T-bond is 0.9%, no MRP is required on a TIPS, and no liquidity premium is required on any Treasury security. Given this information, what should the yield be on a 10-year TIPS? Di
Business
1 answer:
Keith_Richards [23]3 years ago
6 0

Answer:

1.15%.

Explanation:

This can be calculated as follows:

Yield be on a 10-year TIPS = Rate of return on the 10 year T-bond - Average Inflation - Market Risk Premium (MRP)

Therefore, we have:

Yield be on a 10-year TIPS = 4.05% - 2.0% - 0.9% = 1.15%

Therefore, the yield on a 10-year TIPS should be 1.15%.

You might be interested in
Software (such as typical tax preparation software) which in essence interviews the user is following which user interface metap
JulsSmile [24]
Chdbdjbdjvdibdbdjdbdondidbfidbdjfbfidbdjd
6 0
3 years ago
Suppose a country has a national debt of $5,000 billion, a gdp of $20,000 billion, and a budget surplus of $130 billion. how muc
Mrac [35]
<span>a contractionary fiscal policy that will shift the aggregate demand curve to the left by an amount equal to the initial change in investment times the spending multiplier.</span>
6 0
3 years ago
Time to do usps in post office. is open on all days or closed saturday
Law Incorporation [45]
It is open all days of the week
4 0
3 years ago
(I don't need this answered, I just wanted to put the correct answers out there for other users)
Ronch [10]

Answer:

1 with c

2 with b

3 with a

Explanation:

brain list pls

7 0
3 years ago
Three partners are investing a total of 250,000 in a new cell phone repair shop.their investments are in the ratio of 3:5:12.how
Dahasolnce [82]
Let say A,B&C and the ratio is 3:5:12
3+5+12=20
250000divide by 20 = 12500
12500x3=37500
12500x5=62500
12500x12=150000
So A invested 37500
B invested 62500
C invested 150000
8 0
3 years ago
Other questions:
  • The median age for u.s. blacks currently is 30.9 years; for u.s. whites it is 42.3 years. (a) based upon this information, give
    15·1 answer
  • Bill lives in montana and likes to grow zucchini. he applies fertilizer to his crops twice during the growing season and notices
    6·1 answer
  • During the year, a $1,000,000 lawsuit was filed against a U.S. company for unsafe working conditions. Management and the attorne
    12·1 answer
  • What is the typical relationship between time and interest rate
    11·2 answers
  • If the price of Pepsi decreases, all else held constant, then we’d expect to see a consequent shift of the demand curve for: Mul
    14·1 answer
  • The minimum feasible​ long-run average cost for firms in a perfectly competitive industry is ​$48 per unit. If every firm in the
    8·1 answer
  • London Company hired some students to help count inventory during their semester break. Unfortunately, the students added incorr
    7·1 answer
  • The GDP price index is multiple choice 3 computed for each industry sector. a measure of the price of a specified collection of
    14·1 answer
  • Zach sold a restaurant to Shane for $295,000. As part of the agreement, Zach promised not to open another restaurant business fo
    8·1 answer
  • A forecast that addresses the business cycle by predicting planning indicators is.
    7·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!