Answer: The value of the bond will decrease
Explanation:
The Interest rate has a negative inverse relationship with the value of a bond
. When the interest rate increases the value of a bond decreases and when interest rate decreases the bond value increases. Bonds with low coupon rates tend to be more sensitive to interest rate changes this is known has coupon effect.
Bonds with long time frame (long term bonds), they also tend to be are more sensitive to changes in the interest rate this is known has the maturity effect. Therefore a change in the interest rate will cause a huge change in the value of a Bond with low coupon rate and long time period.
The Bond is a 20 year Bonds which qualifies it to be a long term bond and the coupon Rate is 7%, with these facts and knowing that long term bonds are more sensitive to interest rate changes we can conclude that the sudden increase of the interest rate to 15% will cause a huge decrease in the value of the bond
Answer:
The proportion of the investment is 100%.
Explanation:
This can be calculated using the following formula:
Rportfolio = (y * Rrisky) + ((1 - y) * Ttbill) ..................... (1)
Where;
Rportfolio = Overall portfolio expected rate of return = 15%. or 0.15
Rrisky = risky portfolio expected rate of return = 15%, or 0.15
Ttbill = T-bill rate = 10%, or 0.10
Substituting the values into equation (1) and solve for y, we have:
0.15 = (y * 0.15) + ((1 - y) * 0.10)
0.15 = 0.15y + 0.10(1 - y)
0.15 = 0.15y + 0.10 - 0.10y
0.15 - 0.10 = 0.15y - 0.10y
0.05 = 0.05y
y = 0.05 / 0.05
y = 1.00, or 100%
Therefore, the proportion of the investment is 100%.
Complete question:
Assume that the Texas legislature is not in session and the economy has gone into recession. What must occur before legislators can act to reformulate policy
A. The legislature as a body must wait for the comptroller to decertify the budget.
B. The legislature must wait for a special session to be called.
C. The legislature must wait for economic conditions to deteriorate to a point where a constitutional provision allowing deficit spending kicks in.
D. The legislature must wait until the federal government increases monies for state governments.
Answer:
The legislature must wait for a special session to be called.
Explanation:
Once the Texas legislature passes a budget and the governor has acted, after 6 months does the budget go into effect.
The Texas legislature passed a law that requires that an agency take a specific action in order to solve a problem. At formulation stage of the policy making process did the passage of this law occur
A special session (also a exceptional session) in a parliamentary term is a time when the assembly meets outside the usual legislative session. Anyone holding a special meeting would be subject to different requirements, such as by a legislative vote in a normal session, the president, or the presiding officer of the legislature.
Answer:
Following are the answer to this question:
In question first, the answer is "Option d".
In question second, the answer is "Option e".
In question third, the answer is "Option e".
In question fourth, the answer is "Option e ".
In question fifth, the answer is "Option b".
Explanation:
Given values:
Solution:
= $400000000+$340000000+$4000000
= $744000000
= $744000000
+ $50000000+$6000000+$850000000
= $1,650,000,000
-
Saving account deposits, which means its amount of money increased throughout the M2 portion regular savings account. So M2 will grow
- Its increase in the number of employees may not impact the balance sheet with banks, because each bank maintains its entire cash flow
- For banks, loans are investments if they're lending money as a bank to people. So, it's on income statement asset side
Answer
The answer and procedures of the exercise are attached in the following archives.
Step-by-step explanation:
You will find the procedures, formulas or necessary explanations in the archive attached below. If you have any question ask and I will aclare your doubts kindly.
