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iren2701 [21]
3 years ago
11

A Giffen good is a good for which price and quantity demanded are positively related. A Giffen good arises when:_______.

Business
1 answer:
IRISSAK [1]3 years ago
7 0

Answer:

a

Explanation:

A giffen good is  a good whose quantity demanded increases with price increase and reduces with price decreases. This leads to an upward sloping demand curve which is not in line with the law of demand

Example of a giffen good is bread.

For a giffen good there would a negative income effect and a positive substitution effect but the income effect would outweigh the substitution effect

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You observe the following term structure: Effective Annual YTM 1-year zero-coupon bond 5.2 % 2-year zero-coupon bond 5.3 3-year
Lisa [10]

Answer:

Explanation:

a. If you believe that the term structure next year will be the same as today’s, calculate the return on (i) the 1-year zero and (ii) the 4-year zero.

b. Which bond provides a greater expected 1-year return? O 1-year zero-coupon bond O 4-year zero-coupon bond

The return on one year bond is = 5.2%

The price of 4 year bond today

=\frac{ 1000}{ (1.055)^4}

Price of 4 year bond today = 807.22

If yield curves is unchanged, the bond will have 3-year maturity and price will be

=\frac{  1000}{(1.054)^3}

If yield curves is unchanged, the bond will have 3-year maturity and price will be = 854.04

Return

=\frac{ (854.04 - 807.22)}{807.22}

Return = 5.8%

The longer term bond has given the higher return in this case at it's YTM fell during the holding period(4 -year)

8 0
3 years ago
What are 3 examples of things that may be built with Municipal bonds?
Troyanec [42]

Answer:

hospitals, highways, schools

Explanation:

A municipal bond is a type of debt security made by government entities in order to finance <em>capex </em>(capital expenditures), mainly for the construction of hospitals, highways, schools.

They represent loans that investors give to such government entities and they are usually exempt from the usual taxes on building such things.

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Three most difficult responsibility of managing your family​
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Answer:

1) to do all the chores

2) to understand and stop family fights

3) to take care of a sick family member

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Gracie wants to buy a new couch, but there is only one place in her town that sells them, and she lives in an isolated area. Gra
Yuki888 [10]

Answer:

D) choose

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President Kennedy introduced 6 basic consumer rights:

  1. The right to be safe - consumers should not suffer injuries caused by the products they purchase.
  2. The right to choose freely - consumers have the right to choose freely among different options.  
  3. The right to be heard - consumers have to right to voice their complaints and concerns about the products they purchase.  
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  5. The right to education- consumers have the right to request information about the products they purchase.  
  6. The right to service – consumers have the right to better services.

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4 years ago
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