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harina [27]
4 years ago
14

Given that the inflation rate in 2006 was about​ 3.24%, while a short-term municipal bond offered a rate of​ 2.9%, which of the

following statements is​ correct? A. The real interest rate for investors in these bonds was > the rate of inflation. B. Investors in these bonds were able to buy less at the end of the year than they could have purchased at the start of the year. C. The purchasing power of investors in these bonds grew over the course of the year. D. The nominal interest rate offered by these bonds gave the true increase in purchasing power that resulted from investing in these bonds.
Business
1 answer:
borishaifa [10]4 years ago
4 0

Answer:

The correct answer is b) "Investors in these bonds were able to buy less at the end of the year than they could have purchased at the start of the year."

Explanation:

In short words, the return rates that are under inflation, makes you lose money.

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Imagine the tea market has a demand function of QDX = 10 – 2PX and a supply function of QSX = PX − 2, where PX is the price of t
scoundrel [369]

Answer:

Call me 7061528052 call me at the end of the most important thing is that the only way to get to see the place of business and the rest of the most important thing is that the total number of

Explanation:

Call me 7061528052 call me at the end of the most important thing is that the only way to get to see the place of business and the rest of the most important thing is that the only way to get to see the place

3 0
3 years ago
Assume the market basket for the consumer price index has two​ products, bread and​ milk, with the following values in 2013 and
Gnesinka [82]

Answer:

b. 116

Explanation:

The calculation of Consumer Price Index is shown below:-

CPI = ((Base year basket quantities × current year price) ÷ (Base year basket quantities × Base year prices)) × 100

= ((50 × $1.50) + (100 × $1.10)) ÷ ((50 × $1.20) + (100 × $1.00)) × 100

= (185 ÷ 160) × 100

= 115.6

0r 116

So, for computing the consumer price index for 2018 we simply applied the above formula.

3 0
4 years ago
Miller Fruit wants to expand its citrus grove operations. The firm estimates that it needs $8.6 million to buy land and establis
sergeinik [125]

Answer:

2.072 rights

Explanation:

Amount needed to buy the land = $8.6 million = $8,600,000

stock outstanding = 540,000

Market price per share = $34.80

subscription price = $33 a share

Now,

Number shares to be issued = ( Amount needed ) ÷ ( subscription price )

= $8,600,000 ÷ $33

= 260606.06 shares

1 rights will be issued per stock

thus,

number of rights required for purchase

= ( stock outstanding ) ÷ ( Number shares to be issued  )

= 540,000 ÷ 260606.06

= 2.072 rights

3 0
3 years ago
The yield to maturity on a discount bond is: equal to both the coupon rate and the current yield. equal to the current yield but
dlinn [17]

Answer:

greater than both the current yield and the coupon rate.

Explanation:

A discount bond is a bond that at the point of issuance, it's less than its face or par value.

When a bond is trading for less than its face value in the market, it's known as a discount bond.

The yield to maturity on a discount bond is greater than both the current yield and the coupon rate. This simply means that the coupon rate is usually lower than the yield to maturity of the discount bond.

Additionally, the yield to maturity can be defined as the bond's total rate of return required by the secondary market while the coupon rate is defined as the annual interest of a bond divided by its face value.

For instance, when a bond is issued at a par or face value of $5,000, at maturity the investor would be paid $5,000. But because bonds are being sold before its maturity, it would trade below its face value.

Hence, a bond with the face value of $5,000 could trade for as low as $4,800, thus making it a discount bond.

8 0
4 years ago
An employee that has integrity is
damaskus [11]

Explanation:

Integrity is the quality of having strong ethical or moral principles and following them at all times, no matter who's watching. A person with integrity acts with honesty, honor, and truthfulness.

5 0
3 years ago
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