Answer:
25.94%
Explanation:
Assume, Face value of bond =$1000
Purchase price of twenty year zero coupon bond = 1000/((1+i)^N)
. Where, yield = 5% =0.05
, N= number of years to maturity =20
==> Purchase Price = 1000/(1.05^20)
Purchase Price = 1000/2.65329770514
Purchase Price = $376.89
Selling Price after one year: 1000/(1+I)^19. Where i=yield=4%=0.04, N=19
Selling Price=1000/(1.04^19)
Selling Price = 1000/2.10684917599
Selling Price = $474.64
Rate of Return = (474.64/376.89) - 1
Rate of Return = 1.25935949481281 - 1
Rate of Return = 0.2594
Rate of Return = 25.94%
Answer:
It is a sales promotion.
Explanation:
Sales promotion tool is used because of following factors:
a) It improve the sales for short term as it gives another reason to buy the product.
b) It is targeted toward brand switcher.
c) It encourage occasional buyer to make more purchases.
d) Increase new customer and brand loyalty.
e) Provide benefits to existing customer.
Koffee is also using sales promotion tool to get benefit in sales and Brand development.
Answer:
According to fisher equation
(1+nominal Interest rate)=(1+real interest rate)(1+inflation)
1) So 1.17=(1+R)(1.13)
1+R=1.17/1.13
R=1.035-1
R=0.0353
Real interest rate = 3.53 percent
2) (1+NIR)= 1.03*1.04
1+ NIR= 1.072
NIR= 0.072
Nominal interest rate = 7.2 percent
A lender prefers a higher real interest rate as he will earn more money on the amount he has lend if the real interest rate is higher.
A borrower will prefer a lower real interest rate as he will have to pay lower interest payments on an amount if the real interest rate is lower.
Explanation:
Answer: Price of pumpkins will fall compared to last year.
Explanation: Favorable weather leading to a larger crop than usual means that there is more supply of pumpkins this year than before. Shifting the supply curve down to the right. At the same time, when people switch away from jack-o'-lanterns towards buying more costumes, it leads to a decline in the demand for pumpkins shifting the demand curve to the left.
The net result will be a decline in the demand for fall in the price of pumpkin. However, the effect on the quantity cannot be determined as it depends on the magnitude of shift in the two curves.
The type of loan that this is known to represent is what is referred to as the wraparound mortgage loan.
<h3>What is the wraparound mortgage loan?</h3>
This is the type of mortgage that has to do with the fact that the borrower is financing another loan when they have not been able to finance the original mortgage itself.
This type of loan is beneficial to a person given that they would be able to get a system of loan that may not have been possible before.
Hence we have to conclude that Jays financing a property when he has an existing mortgage is what is called the wraparound mortgage loan.
Read more on the wraparound mortgage loan here:
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