1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Reika [66]
3 years ago
12

Assume that the current interest rate on a one-year bond is 8 percent, the current rate on a two-year bond is 10 percent, and th

e current rate on a three-year bond is 12 percent. If the expectations theory of the term structure is correct, what is the one-year interest rate expected during Year 3? (Base your answer on an arithmetic average rather than a geometric average.)
Business
1 answer:
dimulka [17.4K]3 years ago
4 0

Answer:

16%

Explanation:

Given that,

Current interest rate on a one-year bond = 8 percent

Current rate on a two-year bond = 10 percent

Current rate on a three-year bond = 12 percent

One-year interest rate expected during Year 3:

= Current rate on a three-year bond - Current rate on a two-year bond

= (3 × 12%) - (2 × 10%)

= 36% - 20%

= 16%

You might be interested in
Bill is the owner of a house with two identical apartments. He resides in one apartment and rents the other apartment to a tenan
Mnenie [13.5K]

Answer:

B. $2,600

Explanation:

The computation of the net rental income is shown below:

= Monthly rental payments × total number of months in a year - (utilities + maintenance & repairs  + insurance) × percentage - depreciation expense

= $550 × 12 months - ($3,600 + $900 + $500) × 50% - $1,500

= $6,600 - $2,500 - $1,500

= $2,600

Since only one apartment is on rent so we considered the expenses of the building at 50% not full value and the same is applied above

5 0
3 years ago
Choi Company manufactures two skin care lotions, Smooth Skin and Silken Skin, from a joint process. The joint costs incurred are
mafiozo [28]

Answer:

The answer is "205,241"

Explanation:

Its relative value operation:

                                                         Smooth skin        Seedling Skin           Total

A Unit sold                                            240000        \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \     110000

selling price per unit                           \$ \ 3.10   \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \               \$ \ 5.10            

Sales value                                 \$ \ 744,000  \ \ \ \ \ \ \ \ \ \ \ \$ \ 561,000 \ \ \ \ \ \ \ \ \ \ \  \$ \ 1,305,000

Join its cost allocate(360000 \times \frac{sales\ value}{1305000}) 205,241 \ \ \ \ \ \     154,759  \ \ \ \ \ \    360,000

Smooth Skin is assigned the combined costs within each development process by way of the relative cost process                                        205,241

3 0
3 years ago
_____ is the amount of information a communication medium can carry and the extent to which the medium enables the sender and re
asambeis [7]

Answer:

Information richness.

Explanation:

<u>Information richness</u> is the amount of information a communication medium can carry and the extent to which the medium enables the sender and receiver to reach a common understanding. This is the correct answer to your question.

Hope this helps!!!

Kyle.

8 0
3 years ago
When faced with a conflict, police officers should?
mihalych1998 [28]
<span>Policy officers should try to de-escalate the situation to avoid violence whenever possible. Therefore, officers should avoid aggressive approaches or intimidation and should instead be non-confrontations. Physical force should be reserved as an absolute last resort.</span>
4 0
3 years ago
Read 2 more answers
Matrix Corporation's balance sheet and income statement appear below: Comparative Balance Sheet Ending Balance Beginning Balance
Bad White [126]

Answer:

Check the explanation

Explanation:

Cash flow from operating activities:  

Net income                                                                     $116

Adjustment to reconcile net income to cash basis:  

Depreciation expense ($359+1-347)                              $13

Gain on sale of equipment                                              (14)

Decrease in account receivable (40-39)                         $1

Decrease in inventory (44-43)                                          $1

Increase in account payable (30-26)                               $4

Decrease in accrued liabilities (18-15)                              (3)

Decrease in income tax payable (40-39)                         (1)

Net cash flow from operating activities                           $117

5 0
3 years ago
Other questions:
  • If an investment of $45,000 is earning an interest rate of 8.50% compounded annually, it will take for this investment to grow t
    8·1 answer
  • Suppose a period of continuous political instability leads people to believe that the economy will slide into a deep recession.
    9·1 answer
  • When Americans buy goods produced in Canada, Canadians earn income from American expenditures. Does the value of this Canadian o
    14·1 answer
  • Suppose that in a population of 50 million persons, 40 million are in the labor force, 36 million are employed, 2 million are cl
    13·1 answer
  • Outstanding stock of the West Corporation included 40,000 shares of $5 par common stock and 10,000 shares of 5%, $10 par non-cum
    10·1 answer
  • What are forms of phishing?
    6·1 answer
  • Clarence is a sole proprietor who started his business on July 29, 2017. He has not elected any particular tax year. Generally,
    6·1 answer
  • Wizard Co. purchased two machines for $250,000 each on January 2, 2005.
    9·1 answer
  • "Although experience and expertise are important in the hiring decision, many employers are looking at other attributes to decid
    10·1 answer
  • Trinity College sold season tickets for the 2019 football season for $400,000. A total of 8 games will be played during Septembe
    8·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!