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murzikaleks [220]
3 years ago
5

A common reason for redeeming a bond prior to its maturity date is ______.

Business
1 answer:
Veseljchak [2.6K]3 years ago
4 0

Answer:

Correct option is (c)

Explanation:

Market interest rate and price of the bond are inversely related.if market interest rate falls and is lesser than stated interest rate (coupon rate), then the bond becomes attractive and its price increases. So, bond can be solved at present higher than the maturity value. This is the reason bond is redeemed before maturity.

On the other hand, if market rate increases, bond becomes less attractive as investors can earn more by investing at market interest rate. So price of bond falls and there is no point redeeming it before maturity.

You might be interested in
An investor has sold 1 ABC Jan 50 Call and has bought 1 ABC Apr 60 Call. This is a:________.
Kitty [74]

Answer:

diagonal spread

Explanation:

Spread is basically a sale and purchase of a call. So here the the types of spreads determine the relationship between the strike price and the expiration dates of all options involved in the trade.

In this example investor has sold 1 ABC Jan 50 Call and has bought 1 ABC Apr 60 Call. This means he bought the option ABC with the longer expiration date and with a higher strike price and sold the option ABC with the near expiration date and the lower strike price. Here both the expiration and strike price are different. So this is an example of diagonal spread.

The option horizontal spread is incorrect because it is a spread that depicts the difference in expiration dates but strike price is the same. Here both the expiration and strike price are different.

The option straddle is incorrect because it is a spread in which both options have the same expiry date and same strike price. Here both the expiration and strike price are different.

The option dialogue spread is not a valid option too.

The option Combination is also suitable because this is an example of Combination and combinations include option spread trades such as vertical spreads, horizontal spreads, and diagonal spreads.

So the most suitable option is diagonal spread which is an example of Combination.

5 0
3 years ago
Which level of PPE uses APR/PAPR and also includes a chemical/splash over garment, double gloves and chemical resistant boots?
irina [24]

Answer: Level D

Explanation: Level D protection is primarily a work uniform and is used for only nuisance contamination. It requires only coveralls and safety shoes/boots. Other PPE is based upon the situation (types of gloves, etc.). It should not be worn on any site where respiratory or skin hazards exist.

6 0
3 years ago
Lacuna Inc. factors $12,000,000 of its accounts receivables with recourse for a finance charge of 3%. The finance company retain
Elena L [17]

Answer:

The loss on transfer of receivables is $960,000

Explanation:

Sales amount                                       $12,000,000

Finance charge 3%*$12 million              ($360,000)

Retention amount 10%*$12 million           ($1,200,000)

Cash upfront                                           $ 10,440,000

The recourse liability is $600,000,which means that additional liability of $600,000 would be incurred by Lacuna Inc, if the total amount from the receivables is not received owing to the fact that the factoring is with recourse.

The loss on transfer of receivables is shown as:

Finance charge                    $360,000

Recourse liability                  $600,000

total loss                                 $960,000

5 0
3 years ago
Online retailers lose approximately 25% of their customers every year. Unfortunately, due to the highly competitive camping gear
suter [353]

Answer:

CLV =  [(GC * r) / (1 + i - r)] - AC]

Explanation:

CLV is the customer lifetime value which is the calculation of net profit during the tenure of relationship with the clients and customers.

The formula for CLV calculation is :

CLV = [(GC * r) / (1 + i - r)] - AC]

Where,

GC is annual gross contribution,

r is retention rate of customers

i is discount rate

AC is Acquisition cost

3 0
3 years ago
George is paid for holidays, sick days, vacation, personal days, and jury duty. these are his _____. paid leave benefits insuran
MariettaO [177]
I think the correct answer from the choices listed above is the first option. <span>George is paid for holidays, sick days, vacation, personal days, and jury duty. These are his paid leave benefits. Hope this answers the question. Have a nice day.</span>
4 0
3 years ago
Read 2 more answers
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