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Ray Of Light [21]
3 years ago
15

"You want to invest your savings of $20,000 in government securities for the next 2 years. Currently, you can invest either in a

security that pays interest of 8% per year for the next 2 years or in a security that matures in 1 year but pays only 6% interest. If you make the latter choice, you would then reinvest your savings at the end of the first year for another year. Why might you choose to make the investment in the 1-year security that pays an interest rate of only 6%, as opposed to investing in the 2-year security paying 8%
Business
1 answer:
JulijaS [17]3 years ago
6 0

Answer:

Explanation:

In the former case that is investment in security that pays interest of 8% per year for the next 2 years , there is provision of fixed interest rate . That means one can be assured of interest rate of 8 % for two years but he can not get benefit of market fluctuation if interest rate if it  rises above 8 % after one year .

In case of investment in  security that matures in 1 year but pays only 6% interest , one can take the benefit of market fluctuation if interest rate rises above 8 % . So if there is likelihood that interest rate can rise above 8 % in future , one should invest in 6% security for one year and reinvest it after one year , in the same security or in other security which fetches higher rate of interest .

Apart from that , if there is a contingent liability of paying after one year , one can not go in for 2 year security as it will have to break prematurely , that will result in loss of interest .

So due to situation described above,  one should prefer investment in one year security .

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scZoUnD [109]

Answer:d. total market service quality survey.

Explanation:

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Employee survey will not give information on the product nor customers evaluation, customer focused interview will miss out other vital information like competitors market performance, solicitation of customers complain may be bias and mystery shopping may not be adequate to be used for evaluation.

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3 years ago
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mario62 [17]
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3 years ago
With its current levels of input use, a firm's MRTS is 1/3 (when capital is on the vertical axis and labor is on the horizontal
bixtya [17]

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Explanation:

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If a firm therefore used one unit of capital and kept labor constant, it could produce 3 units out output.

4 0
2 years ago
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notsponge [240]

Explanation:

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6 0
3 years ago
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3 0
3 years ago
Read 2 more answers
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