The spread between the interest rates on bonds with default risk and default-free bonds is called the risk premium.
A default-free bond is a bond in which the bond issuer would not miss scheduled payments of either the coupon or principal. Bonds issued by the government are generally considered to be default-free. This is because the government can print money to make payments.
A bond with a default risk is a bond in which the bond issuer can miss scheduled payments of either the coupon or the principal. Bonds issued by private individuals are generally considered to be bonds with default risk.
Bondholders usually demand a compensation for holding bonds with a default risk. This compensation is known as risk premium.
Risk premium = return on bonds with default risk - return on default- free bond.
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Answer:
pooling losses
Explanation:
This agreement embodies the concept of pooling losses. In this concept, each individual loss is spread over to the entire group. In order for this arrangement to be effective, a large number of farmers are required, so whenever a farmer suffers a loss, it will be mitigated due to the pooling over the large group.
The idea for a $15/hour minimum wage is to provide a <u>living wage</u> for employees, meaning that they can meet their basic housing, food, medical, and living expenses when working full time at minimum wage.
Answer: The correct answer is "d. control the direction".
Explanation: Uber need to control the direction because:
a. make the plan - The plan has already been drawn up, is to withdraw from China and Singapore.
b. make the goal - The objective was not met because, despite having executed the plan, there are still losses.
c. define objectives - The objectives have already been defined and is to reduce losses.
d. control the direction - The executed plan is not fulfilling the objectives therefore it is necessary to control the direction of it.
e. carry out the plan - The plan has already been carried out, a year has passed and there are still losses.
Answer:
OAR per Machine Set-ups = $60
OAR per Machining = $15
OAR per Inspection = $50
Explanation:
Overhead Absorption Rate (OAR) = Estimated Overhead Costs/ Cost drivers
OAR per Machine Set-ups = $150,000/2,500
= $60 per set-up
OAR per Machining = $375,000/25,000
=$ 15 per machine hr
OAR per Inspection = $87,500/1,750
=$50 per inspection
