<span>the type of breakup this example represents is: sudden death
A sudden death breakup is a form of break up that seem to come out of nowhere without any form of build up.
The only reason this break up could happen is if the communication in that relationship is totally dead and they have no attachment toward one another</span>
Answer: Here in this particular case, people prefer and enjoy both eating fresh fish with tartar sauce and lobster with drawn butter.
Given : A hurricane destroys most of the fishing boats on the Macro Islands but leaves the lobster traps untouched.
Therefore, there will be a bountiful supply of Lobster.
whereas;
Fishing requires boat and since they are decimated, therefore there will be decrease in supply.
Hence, <u><em>people will demand more of "drawn butter" in order to compliment lobsters.</em></u>
Answer:
The answer is setup cost (option C)
Explanation:
Setup cost is simply the cost that comes with the setting up or configuration of production equipment, tools or machines that are needed to produce an item.
This kind of costs are often incurred when assembly or production lines of a factory have been changed. Thus, there is a need to spend money on securing the services of a setup mechanic as well as testing the first output in order to be sure that the equipment, tools or machines have been set up properly.
Answer:
a. The risk premium on Risky Investment bond = 5.8
b. Such a change would decrease/reduce 4.2%
c. The expected default rate on the Risky Investment bond has decreased (1).
Explanation:
a. The risk premium on a risky investment is equal to the total return on a risky investment less the return on the risk free asset. The risky asset here gives an annual return of 7.1% while the risk free rate is 1.3%. So, the risk premium on the risky asset for additional risk is,
b. A reduction in the annual return on the risky asset will decrease/reduce the interest rate spread which is equal to the difference between the return of the risky and risk free asset. The new spread will be equal to,
c. The risk free rate is expected to be the same as no information is provided. Besides, a fall in annual rate of risky investment means that there is a reduction in the riskiness of such an investment and that would mean that there is a reduction in the default risk in turn leading to a reduction in compensation for default and the default rate.
The risk is made up of risk free + maturity risk + liquidity risk and default risk.