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Bumek [7]
3 years ago
10

People who might need to retrieve part or all of their investment relatively soon, such as the elderly, are often advised to inv

est a higher percentage of their money in bonds, and thus a lower percentage in stocks, than people who can leave the investment untouched for decades. We know, however, that bonds typically have a lower rate of return than stocks. Why would people be advised to invest in assets that give lower average rates of return
Business
2 answers:
jeyben [28]3 years ago
7 0

Answer: C. While stocks have a higher rate of return in the long run, they are much more volatile (riskier) in the short run. As such, they have a higher probability of having less than the original value of the investment for people who might need to withdraw the investment in the short run.

Explanation:

As stated, people who need to withdraw part or all of their investments in a short time frame such as the elderly are advised to invest in bonds as opposed to stock.

To properly benefit from Stock ownership, one has to be willing to leave it for a long period of time because stocks are more volatile in the short run. If a person needs to withdraw in a short horizon and goes in on Stock, they may lose some of their money due to Capital losses if the Stock reduces in value.

Bonds on the other hand will give a steady income so that even if you wish to withdraw in a short time, you can with the probability of no losses in that short time frame.

Misha Larkins [42]3 years ago
7 0

Answer:

The payment from bond is guaranteed, while the value of stock fluctuates.

Explanation:

Stock is a risky asset and the risk is compensated by a higher rate of return in the long run. However, the stock being a risky asset can lose its value that generally fluctuates.

However, bond is not categorized as a risky asset and its payment is guaranteed.

Therefore, it is advisable for the elderly to invest a higher percentage of their money in bonds, and thus a lower percentage in stocks.

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Katen [24]

Answer:

D. Helps managers to act rapidly and with autonomy

Explanation:

The management control system defines that every policy and procedure should be followed in a proper manner and work on new strategies for the benefit of the organization. It helps in managing the hierarchy level and differentiates the performance company resources like finance, marketing, sales, Human resource management, operations, etc.  

Therefore the management control system provides to work with sovereignty so that the work runs in a smooth and inefficient and effective manner. It also helps the managers to take the action quickly before things go out of control.

3 0
3 years ago
Even when competitive firms are unable to calculate marginal revenue product directly, ______________________________ will push
Alona [7]

Answer:

Even when competitive firms are unable to calculate marginal revenue product directly, <u>competition in the labor market</u> will push wage rates toward the marginal revenue product of labor.

Explanation:

The labor market is made up of employers seeking for labor and employees offering their labor services. The law of supply and demand also applies to this market, when more employers are seeking employees, the price (= salary) will increase.

For example, if many companies are making a  profit and they need more labor, the salaries will rise because the demand is rising.

Also the suppliers, the potential employees, compete against each other for the best possible jobs.

8 0
3 years ago
A 6-year bond, 8% semiannual coupon bond sells at par ($1,000). Another bond of equal risk, maturity, and par value pays an 8% a
timofeeve [1]

Answer:

Explanation:

  • The bond has 8% coupon paid semiannually, and those bonds sell at their par value.
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<u>Second bond:</u>

  • Coupon rate = 8%
  • Par value = $1,000
  • Semiannual coupon amount = 1000 x 8%/2 = $40
  • Time to maturity = 6 years = 12 semiannual periods
  • Semiannual Yield = 8%/2 = 4%

To get price of this bond we will use PV function of excel:

= PV (rate, nper, pmt, fv, type)

= PV (4%, 12, -40, -1000, 0)

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7 0
2 years ago
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Answer:

$31,046

Explanation:

You take the $50,000 and divide it by 1.10^5 = $31,046

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Explanation:

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According to the given code snippet, a "button" would be created with the label "cancel".  

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3 years ago
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