When interest rates are expected to rise, then Joe Hill should D. prefer the Asbury bond to the Wildwood bond.
<h3>What is a bond?</h3>
A bond simply means a form of security that is used in mutual funds and private investing.
In this case, when interest rates are expected to rise, then Joe Hill should prefer the Asbury bond to the Wildwood bond. This is important to prevent loss.
Learn more about bond on:
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Answer:
Total debt = $3,900,000
Explanation:
Total Assets = $5,200,000
Debt Ratio = 75%
Debt = 75% x $5,200,000
=$3,900,000
Hence, the 25% account for equity finance $1,300,000
Answer:
D1 = $4.085
D2 = $4.46
D3 = $4.86
D4 = $5.01
D5 = $5.16
Explanation:
As per the data given in the question,
DO = $3.75
Dividend expected to grow = 9%
Dividend grow later = 4%
D1 = DO(1+ Dividend1) = $3.75(1+9%)
=$3.75(1.09)
=$4.085
D2 = DO(1+ Dividend1 )( 1 + Dividend2)
= $3.75(1+9%)(1+9%)
= $4.46
D3 = DO(1+Dividend1)(1+Dividend2)(1+Dividend3)
= $3.75(1+9%)(1+9%)(1+9%)
= $4.86
D4 = DO(1+Dividend1)(1+Dividend2)(1+Dividend3)(1+Dividend later)
= $3.75(1+9%)(1+9%)(1+9%)(1+3%)
= $5.01
D5 = DO(1+Dividend1)(1+Dividend2)(1+Dividend3)(1+Dividend later)(1+Dividend later)
= $3.75(1+9%)(1+9%)(1+9%)(1+3%)(1+3%)
= $5.16
Answer:
A) higher interest rates ; largely offset by the lower interest rates
Explanation:
If the government carries on an expansionary monetary policy, it will lower interest rates and increase the money supply in an attempt to increase aggregate demand. If at the same time it increases the interest rate it will pay for borrowing money (e.g. increase treasury bills' interest rates), that would make no sense since one policy would offset the other.
A government cannot increase the money supply and then increase the interest rates on treasury bills since that would lower the money supply again.
