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
natulia [17]
3 years ago
5

Rank the following instruments in terms of credit risk. In your rankings, use 1 for the greatest credit risk and 4 for the small

est credit risk. Assume a 10 year Treasury trades with a YTM of 5%.a. A Ba1 corporate bond ______b. A ten-year BBB- corporate bond with a YTM of 7% ______c. A secured loan from Argosy Gaming, which is a B- rated firm ______d. A senior subordinated bond from Argosy Gaming
Business
1 answer:
bija089 [108]3 years ago
8 0

Answer:

a. A Ba1 corporate bond <u>2 (not investment grade)</u>

b. A ten-year BBB- corporate bond with a YTM of 7% <u>3 (medium risk but still investment grade)</u>

c. A secured loan from Argosy Gaming, which is a B- rated firm <u>4 (less risky since it is backed by a collateral)</u>

d. A senior subordinated bond from Argosy Gaming <u>1 (highest risk)</u>

Explanation:

There are two major bond rating agencies in the US: Moody's and Standard & Poor's.

Their rankings are very similar, although the letters vary a little:

AAA: safest

AA: low risk

A: low risk

BBB: medium risk

BB: a little bit more riskier

B: risky

CCC: very high risk

CC: even riskier

C: riskiest

D: junk, in default

You might be interested in
A clothing store has ordered 100,000 swimsuits. It costs $22 to produce a swimsuit. They plan to sell them until August 31 at a
fomenos

Answer:

Total profit = $1800000  @ a given demand level of 100K units of swimsuit.

Explanation:

Lets first develop a formula representing the Total profit for any demand level, see as follows:

(Selling price per unit× d) - (cost per unit× d)= Total profit

We will be using the short forms of the components in this formula.

SP = selling price per unit

d= demand

cp= cost per unit

TP= Total profit.

Now lets substitute the values into the formula to compute profit at any demand level (in this case 100,000 units of swimsuits) as follows:

Total profit = ($40× 100000) - ($22× 100000)

Total profit = $4000,000 - $2200,000

Total profit = $1800000  @ a given demand level of 100K units of swimsuit.

<em />

<em>(NOTE: The formula mentioned above can be used to compute the correct profit for any demand level, even though if there is a change in sp and/or cp, the formula can also be useful.)</em>

8 0
3 years ago
Enter mia profit/loss for the 2 month
Tems11 [23]
She profits more each month
8 0
3 years ago
Which two tasks does an industry safety and health engineer perform?
kolezko [41]

Answer:

They both care for the well-being of people and they also keep people safe.

I'm assuming

8 0
3 years ago
Brokerage firms make their profits primarily in which of the following ways? A) Consumer deposits. B) Government deposits. C) Di
Anastasy [175]
Brokerage firms make their profits primarily in : D. Fees commissions on sales or transfers

to put it simply, A brokerage firm is a financial institution that facilitates the selling process of stock/securities between the buyer and the seller. From each transaction that happen, a brokerage firm will receive a commission from its client.

hope this helps
5 0
3 years ago
Read 2 more answers
Mention two benefits of positive values at the work place​
Trava [24]

giving health care and paying salary

6 0
3 years ago
Other questions:
  • The direct write-off method records bad debt expense only when an account becomes uncollectible, which is not always in the same
    15·1 answer
  • When you plan a presentation, how should you make sure you stay on track as you talk?
    12·2 answers
  • An externality arises when a firm or person engages in an activity that affects the wellbeing of a third party, yet neither pays
    10·1 answer
  • If the price of chicken feed decreases, the supply of chicken nuggets will shift
    12·1 answer
  • Which of the following is not included in the computation of the quick ratio? a. Accounts receivable b. Marketable securities c.
    13·1 answer
  • 2000 is deposited into a newly opened fund on January 1, 1999. Another deposit is made into the fund on July, 1 1999. On January
    13·1 answer
  • Match the following items.
    7·1 answer
  • Duggins Veterinary Supplies can issue perpetual preferred stock at a price of $75 a share with an annual dividend of $6.00 a sha
    15·1 answer
  • Which statement about natural resources is NOT true?
    12·2 answers
  • A person should consume more of something when its marginal.
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!