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Veronika [31]
3 years ago
15

Which of the following statements is correct? Multiple Choice Interest rates and bond prices vary directly. Interest rates and b

ond prices vary inversely. Interest rates and bond prices are unrelated. Interest rates and bond prices vary directly during inflations and inversely during recessions.
Business
1 answer:
nevsk [136]3 years ago
8 0

Answer:

Interest rates and bond prices vary inversely

Explanation:

The relationship between interest rate and bond prices can be seen in the bond pricing formula. Given a series of coupon payments (C) paid over the lifetime (ranging from "1" through "i" to "n") of a bond, and given that the bond will repay the principal investment (F) at maturity, the price of the bond is

P = ∑\frac{C}{(1+r)^{i}}  + \frac{F}{(1+r^{n})}

where "r" is the interest rate.

As seen in the formula, the price of the bond (P) is inversely related to the interest rate (r).

Option A is incorrect because interest rates and bond prices vary indirectly, not directly. Option C is incorrect because interest rates and bond prices are related. Option D is incorrect because vary inversely irrespective of inflation and recession.

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Imagine yourself as a business owner just before an economic event such as a recession or depression. What impact would
never [62]
I’d be like —> aww hecc my business gonna lose so much customers now I gotta figure out ways to cut costs and I may have to fire some people. Now I have to decrease my prices... stupid economy. I want my good paying customers back ;(
5 0
3 years ago
Marcy's mother, Sue, did not want her to date until she was older. She also wanted Marcy to attend law school. Just before Marcy
KATRIN_1 [288]

Answer:

<u>B) No, there was insufficient consideration because Sue did not promise anything in exchange</u>

Explanation:

Remember, in law for there to be consideration there must be something of value (between the parties concerned, which is exchanged for the performance or promise of performance by the other party (such performance itself is consideration).

Thus, it could be said that Marcy's agreement to throw a party for Sue lacked insufficient consideration since there was no stated value because Sue did not promise anything in exchange.

3 0
3 years ago
Jake borrowed $800,000 from the Gateway Bank to purchase a fishing boat. He keeps the boat at a dock owned by the Harbor Company
atroni [7]

Answer:

1. Gateway Bank

3. White Shark Fishing Company

Explanation:

In the scenario being described the two entities that have an insurable interest in Jake or his property would be Gateway Bank and The White Shark Fishing Company. The Bank has an insurable interest because if something where to happen to Jake they would most likely incur the loss of $800,000 that Jake borrowed, the same goes for the boat since without the boat Jake can't earn income to pay back the loan. The White Shark Fishing Company on the other hand entrusts Jake with their cargo, meaning if anything happens to Jake or the Boat they would lose all of their cargo that Jake is transporting. This would cause them to have to incur those loses.

b. If Jake operated the boat on behalf of the White Shark Fishing Company he would have an insurable interest on the boat since he would lose the income that he makes with the boat. Also, if Jake has a contract and is responsible for the boat he might even have to incur the damages for the boat.

7 0
3 years ago
Which of the following statements is(are) true:
Rudiy27

Answer:

Neither I nor II are correct

Explanation:

I. The nominal interest rate is also referred to as the APR or the stated rate.

This statement is not true because nominal interest rate is different from the annual percentage rate (APR).

A nominal interest rate is basically the interest rate is charged by banks or other financial institutions on a loan, and other expenses on the loan are not added to the interest when interest rate is being determined.

On the other hand, APR is nominal interest rate plus other expenses incurred in other to get the loan.

Therefore, nominal interest rate is usually lower than the APR. This makes them to be different.

II. You should use the nominal interest rate to compare two alternative investments/loans with different compounding periods.

This statement is not correct.

The interest rate is used to to compare two alternative investments/loans with different compounding periods is the effective interest rate.

The effective interest rate is the actual amount of interest rate that a lender or an investor earned on his loan, investment because of compounding that is done during a specific period of time. The effective annual interest rate is the interest rate that is employed to compare different investment products because, unlike other interest rate, compounded interest are estimated differently by it.

Therefore, Neither I nor II are correct.

I wish you the best.

5 0
4 years ago
Growland is a country that trades only with Canada. Last year, the value of exports from Growland to Canada was $200 million. Gr
aivan3 [116]

Answer:

growling imports 400million good in trade than Canada

7 0
3 years ago
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