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Mashcka [7]
2 years ago
5

If a loan has a nominal annual rate of 8%, then the effective rate can never be greater than 8%. b. If a loan or investment has

annual payments, then the effective, periodic, and nominal rates of interest will all be different. c. The present value of a 3-year, $150 annuity due will exceed the present value of a 3-year, $150 ordinary annuity. d. The proportion of the payment that goes toward interest on a fully amortized loan increases over time.
Business
1 answer:
AnnZ [28]2 years ago
7 0

Answer:

c. The present value of a 3 year, $150 annuity due will exceed the present value of a 3 year, $150 ordinary annuity.

Explanation:

Annuity is a lump sum payment of the present value of invested amount or profits which is to be received by the investor at the maturity date. The annual profits are summed up and then annuity is calculated to identify the real worth of money expected to be received in future.

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Answer:

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6 0
2 years ago
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The slope and position of the long-run aggregate supply curve
malfutka [58]
<span>Suppose the Fed doubles the growth rate of the quantity of money in the economy. In the long run, the increase in money growth will change which of the following? Check all that apply.

__ The price level
__ The inflation rate

Suppose the economy produces real GDP of $50 billion when unemployment is at its natural rate.
(graph goes here)
Suppose the government passes a law that reduces unemployment benefits in a way that causes unemployed workers to seek out new jobs more quickly. The policy will cause the natural rate of unemployment to (rise / fall) which will:
__ Shift the long-run aggregate supply curve to the left


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5 0
3 years ago
Read 2 more answers
Pick the correct statement from below. Multiple Choice A deferred call provision requires the bond issuer to pay the current mar
jeyben [28]

Answer: A deferred call provision prohibits the bond issuer from redeeming callable bonds prior to a specified date.

Explanation:

A deferred call provision refers to the provision whereby the calling of a bond before a particular date is prohibited. The bond is known to be call protected during this period.

Therefore, a deferred call provision prohibits the bond issuer from redeeming callable bonds prior to a specified date.

6 0
2 years ago
When the demand curve for a good is unit elastic, raising the price of the good by 25 percent will change the revenue of the fir
san4es73 [151]

Answer: 0%

Explanation:

Elasticity measures the change in demand resulting from a change in price. The law of demand holds that when prices increase, quantity demand would decrease and elasticity is meant to show the magnitude of this change.

A unit elastic good means that prices and quantity demanded change by the same amount. This means that for a unit elastic good, if the price change is a 5% increase, the quantity demanded will decrease by 5%.

In terms of revenue, if the price increases by the same amount that quantity demanded decreases, the effects will cancel out so there will be no revenue effect.

4 0
3 years ago
You’ve collected the following information from your favorite financial website.
Nataliya [291]

Answer:

-9.92%

Explanation:

P₀ = Div₁ / (Re - g)

  • Div₁ = next year's expected dividend = $1.12 x (1 - 11.5%) = $0.9912
  • Re = cost of equity = ?
  • P₀ = current stock price = $62.91
  • g = dividend's growth rate = -11.5%

Re =  (Div₁ / P₀) + g

Re = ($0.9912 / $62.91) - 11.5%

Re = 1.58% - 11.5% = -9.92%

Since the cost of equity or required rate of return cannot be negative, I suppose that investors are not worried about Abbott distributing dividends, instead, they prefer that the company reinvests earnings in new projects.

3 0
3 years ago
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