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pentagon [3]
3 years ago
5

Interest rates generally reflect

Business
1 answer:
dem82 [27]3 years ago
5 0

Answer:

the level of risk in an investment

Explanation:

Interest rates show the percentage yield an investor will be gaining from undertaking a particular investment. All investments reward investors with regular returns that are expressed a percentage of the principal amount.  The higher the returns, the more attractive the investment.  Interest rates are the rewards or returns from an investment.

A high-interest rate is also indicative of the risk associated with the investment.  Generally, high-risk investments will offer a higher interest rate. Government bonds and treasury bills are the safest investment but offer lower interest rates. Corporate bonds are riskier but have high-interest rates.

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Arondale Aeronautics has perpetual preferred stock outstanding with a par value of $100. The stock pays a quarterly dividend of
german

Answer:

Annual Rate of Return = 12%

Effective Annual Rate of Return = 9.6%

Explanation:

Nominal Annual Rate of return = \frac{Dividend\: per\: share\: for\: each\: year}{Par\: price\:per\:share} \times 100

Annual Dividend per share = $3 per quarter \times 4 = $12 per share

Current price per share = $125

Par Price per share = $100

Thus Annual Rate of return = $12/$100 = 12%

Effective Annual Rate of Return = \frac{Dividend\: per\: share\: for\: each\: year}{Current\: price\:per\:share} \times 100

= \frac{12}{125} \times 100 = 9.6%

Final Answer

Annual Rate of Return = 12%

Effective Annual Rate of Return = 9.6%

4 0
3 years ago
At what rate per cent per annum will 4000 yield an interest of 410 in 2 years?​
andrey2020 [161]

Answer:

5%

Explanation:

The applicable formula is A = P( 1 + r) ^ n

where A= amount: P is the principal, r, interest rate, n time

In this case,

A = principal + interest = Rs 410 { Rs 4000 + Rs410}

P= Rs 4000

r= ?

n= 2

r is?

4410 = 4000(1 + r) ^2

(1 + i)^ 2 = 4410/4000

(1 + i)^ 2 = 1.1025

1 + i = √1.1025

1 + i = 1.05

i = 1.05 - 1

i = 0.05

0.05 × 100 = 5%

5 0
3 years ago
Why may Consumers overspend when using a credit card?
Gekata [30.6K]
Because it is very easy to spend money that you do not have by using a credit card.  Most think they can pay it off the following month, but that rarely happens.
8 0
3 years ago
A decrease in consumer spending can be expected to shift the aggregate demand curve ________.
xxMikexx [17]

Answer:

d. downward and cause output to decrease

Explanation:

As we know that

Aggregate demand = Consumption expenditure + government expenditure + net export

Where,

Net export = Export - import

In the case when there is a reduction in the consumer spending so it would be expected that the aggregate demand curve would be shifted to the downward due to which it results in reduction in output

Therefore the option d is correct

6 0
3 years ago
Alpha Computing is a U.S. company that specializes in IT research. It has formed a joint venture with Microchips Inc., a Belgium
lianna [129]

Answer:

The correct answer is option A,strategic alliance

Explanation:

Strategic alliance it is a form of partnership where businesses avail one another strategic resources in the areas of supply chain management,production,marketing,distribution,technological advancement and know-how for the joint benefits and advantage of all partners.

In this case,Alpha as the leader in laptop designing  is combining resources with another technological giant Microchips Inc. in order that they may complement each other's efforts.The synergy impact of such arrangement is enormous as each partner concentrates on what he knows best.

8 0
3 years ago
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