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olga55 [171]
2 years ago
7

A bond par value is $1,000 and the coupon rate is 6.3 percent. The bond price was $946.86 at the beginning of the year and $984.

56 at the end of the year. The inflation rate for the year was 2.1 percent. What was the bond's real return for the year
Business
1 answer:
a_sh-v [17]2 years ago
5 0

Answer:

8.36%

Explanation:

The computation of the real rate of return is given below:

Coupon amount = $1,000 × 6.3% = $63

Return on price is

= $984.56 - 946.86

= $37.7

Now

Nominal rate of return =( (63 + 37.7) ÷ 946.86 ) × 100

= 10.64%

And, finally  

Real rate of return = (1+ nominal return) ÷ (1+inflation) - 1

= (1.1064 ÷ 1.021) - 1

= 8.36%

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sladkih [1.3K]

Answer:

This is false. buying a franchise is expensive, as it involves buying the rights of a business from the business owners, who are commonly referred to as ''franchisiors".

Explanation:

Ravi would not be able to run the franchise business the way he wants as the Franchisiors determines the business model and procedures. Hence, he would have a limited control on the business. Thus, I would advise Ravi to avoid going into a Franchise business, if his motive is to be his own boss and have control on his business.

8 0
3 years ago
Both Bond Sam and Bond Dave have 8 percent coupons, make semiannual payments, and are priced at par value. Bond Sam has 3 years
Natali5045456 [20]

Answer: -12.1%

Explanation:

Bond Sam was priced at Par which means it could have been priced at $1,000 and its yield was the same as the coupon rate of 8%.

If interest rates rise by 5%, the yield becomes:

= 8% + 5%

= 13%

Price of bond is attached:

Yield = 13% /2 = 6.5% per semiannual period

Coupon = 8% * 1,000 * 0.5 = $40 per semi annual period

Period till maturity = 3 * 2 = 6 semiannual periods

Price = $878.97

Percentage change in price:

= (878.97 - 1,000) / 1,000 * 100%

= -12.1%

4 0
3 years ago
What are the different types of banking institutions
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Central Banks, Retail Banks, Commercial Banks, Shadow Banks, Investment Banks, Cooperative Banks, Credit Unions.

5 0
3 years ago
Janet and Megan are debating the use of student discounts by local stores near school. Janet argues, "When stores offer discount
Ilya [14]

Answer:

Antonio

Explanation:

In simple words, Antonio has a lot of support among economists. Price discrimination occurs when a vendor is able to split clients into groupings or segregate a marketplace into two categories so that they may charge varying charges to that same two groups. It has hardly anything to deal with the customers' age.

Thus, Antonio is correct with his views.

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3 years ago
the graph shows the curves facing a profit maximizing monopolistic competitor. label each curve with the appropriate term.
Katen [24]

A monopoly is a market situation in which a good or service is offered by only one company. The existence of a monopoly presupposes that there are no other exchangeable products on the market for buyers.  

The conditions that can cause the creation of a monopoly are many: state legislation that prohibits other companies from operating in a market, the overwhelming superiority of a company over its competitors, the neutralization of rivals with appropriate strategies by the monopoly company, and special market characteristics that allow profitably running just one business, between others.

The monopoly company has the ability to influence the quantity or price of a good, as it wants, since it can and does control the market.

Learn more in brainly.com/question/5992626

4 0
2 years ago
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