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AleksandrR [38]
3 years ago
14

risk is the risk of a decline in a bond's value due to an increase in interest rates. This risk is higher on bonds that have lon

g maturities than on bonds that will mature in the near future. risk is the risk that a decline in interest rates will lead to a decline in income from a bond portfolio. This risk is obviously high on callable bonds. It is also high on short-term bonds because the shorter the bond's maturity, the fewer the years before the relatively high old-coupon bonds will be replaced with new low-coupon issues. Which type of risk is more relevant to an investor depends on the investor's , which is the period of time an investor plans to hold a particular investment.
Business
1 answer:
Ilya [14]3 years ago
8 0

Answer:

Price Risk, Reinvestment Risk, Investment Horizon and Longer maturity Bond.

Explanation:

  • Price risk is the risk of a decline in a bond's value due to an increase in interest rates. This risk is higher on bonds that have long maturities than on bonds that will mature in the near future.
  • Reinvestment risk is the risk that a decline in interest rates will lead to a decline in income from a bond portfolio. This risk is obviously high on callable bonds. It is also high on short-term bonds because the shorter the bond's maturity, the fewer the years before the relatively high old-coupon bonds will be replaced with new low-coupon issues.
  • Which type of risk is more relevant to an investor depends on the investor's investment horizon, which is the period of time an investor plans to hold a particular investment.
  • Longer maturity bonds have high price risk but low reinvestment risk, while higher coupon bonds have a higher level of reinvestment risk and a lower level of price risk.
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What is supply-side fiscal polioy? Identify each policy action as being focused on the demand side, the supply side, or both. Dr
Advocard [28]

Answer: Please refer to Explanation

Explanation:

Supply Side Fiscal Policy focuses on how to improve the ability of companies to supply more goods to the economy. The aim being that as companies supply more, they grow more and employ more people.

Demand Side Fiscal Policy on the other hand focuses on how to give more power to the Demand side of the Economy. It holds that increasing demand leads to increased supply which is good for the economy.

Classifying the above,

1. research grants for a corporation developing new technologies. SUPPLY SIDE.

This is aimed at increasing supply by improving the ways a company is able to produce it's goods and services.

2. government-funded scholarships for college students. SUPPLY SIDE.

This is supply side because it leads to more Colleges offering placement to students.

3. stimulus packages for firms that are "too big to fail". DEMAND SIDE.

Companies considered Too big to fail usually hire a lot of people. Keeping them running leads to them being able to pay off their employees which increases the demand in the economy.

4. increasing spending on "shovel-ready" projects. DEMAND SIDE.

Shovel Ready projects are those that are ready to be initiated. By increasing spending on them, they hire people immediately and begin work which increases the income flowing to people in the economy which increases demand.

5. lowering income tax rates at all income levels. BOTH.

By lowering income tax levels people are both able to spend more which increases demand as well as able to Invest more in companies which will increases supply.

8 0
3 years ago
The following two assets and payout data are given​ below: Asset A​: Pays a return of​ $2,000 20% of the time and​ $500 80% of t
andrew-mc [135]

Answer:

I would prefer Asset B

Explanation:

A risk averse investor is the one who prefers lower amount of returns with known or specific risks instead of the higher amount of returns with unknown risks. So, from among the various level of risks, the investor will be preferring the alternative with the least interest.

So, in this case,

In Asset A: pay a return of $2,000 and at 20% of time and the $500 at 80% of time.

In Asset B: pay a return of $1,000 and at 50% of time and the $600 at 50% of time.

So, I would prefer, Asset B as it has low return but have a known risk that is of 50 -50.

6 0
3 years ago
Unlimited marital deduction applies when there is an outright bequest of stock
dmitriy555 [2]
That statement is true.
<span>outright bequest is another term for 'inheritance;.
When a man dies without writing any particular will, all of the assets that the man possess would be given to the spose. Due to unlimited marital deduction, the wife does not need to pay any form of taxes for all the wealth that she recieved</span>
3 0
3 years ago
A study by the Environmental Protection Agency looked at the costs and benefits of the Clean Air Act from 1970 to 1990. This stu
qwelly [4]

Answer: d. 44 times higher

Explanation:

The benefits of cleaner air was $22 trillion and the cost of reducing pollution was $500 billion.

The number of times that you would have to multiply this cost of reducing pollution to get to the benefits of cleaner air is:

= 22 trillion / 500 billion

= 22,000 billion / 500 billion

= 44 times higher

5 0
2 years ago
Q Co. prepares monthly income statements. A physical inventory is taken only at year end; hence, month-end inventories must be e
Dmitriy789 [7]

Answer:

$14,000

Explanation:

Sale made = Accounts Receivable on 30 June + Collections of accounts - Accounts Receivable on 1 June

= $15,000 + $25,000 - $10,000

= $30,000

Cost of goods sold = Sales made ÷ rate of mark-up on cost

= $30,000 ÷ 150% × 100%

= $20,000

Estimated cost of the June 30 inventory = Inventory Balance on June 1 +  Purchases made during June -  Cost of goods sold

= $18,000 + $16,000 - $20,000

= $34,000 - $20,000

= $14,000

5 0
3 years ago
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