1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
kompoz [17]
3 years ago
10

Conservative Bank offers loans at various interest rates, depending on the nature of the loan. Jake wants to borrow $200,000 for

a new home. He promises to pay back the loan in 10 years. Alyssa also wants to borrow $200,000 for a new home. She promises to pay back the loan in 15 years. Assume Jake and Alyssa are equally creditworthy and that the two home mortgages are the same in all other aspects. If all else is constant, the bank would most likely charge a higher interest rate to___.
Business
1 answer:
Helga [31]3 years ago
5 0

Answer:

Bank would most likely charge a higher interest rate to Alyssa

Explanation:

Credit worthiness of Jake and Alyssa is same and interestingly amount is also same. But Alyssa is taking it for long period of time say, 15 years while Jake will return in 10 years. Bank decides the interest rate based on the economic conditions. Short term loan are given at lower rate because it is easy to predict the future. But here in both cases, loans are taken for long period. But still Alyssa period is greater than Jake. Thus, bank will charge higher interest rate from Alyssa.

You might be interested in
Which of the following is NOT a benefit of a social media presence for a brand? Group of answer choices Social media allows comp
ollegr [7]

Answer: Social media allows companies to have a short-term focus.

Explanation:

Social Media has made the world way more connected than it was before even with the advent of the Internet. As such, companies were able to leverage on this to improve their brand and popularity by being present on the various social media platforms.

With social media, companies have been able to marketers to establish a public voice and presence online, cost-effectively reinforce other communication activities, build online forums and communities as well as remain relevant in a fast changing world.

Companies having a short term focus as a result of social media <em>is not a benefit</em> of social media. A company should always think long term and even social media can help them achieve long term growth if long term marketing plans are integrated with social media marketing.

5 0
3 years ago
The expected return and standard deviation of a portfolio that is 30 percent invested in 3 Doors, Inc., and 70 percent invested
kirill115 [55]

Answer:

For correlation 1 the standard deviation of portfolio is 0.433.

For correlation 0 the standard deviation of portfolio is 0.3191.

For correlation -1 the standard deviation of portfolio is 0.127.

Explanation:

The standard deviation of a portfolio is computed using the formula:

\sigma_{P}=\sqrt{w^{2}_{1}\sigma_{1}^{2}+w^{2}_{2}\sigma_{2}^{2}+2\times r\times w_{1}\sigma_{1}w_{2}\sigma_{2}}

(1)

For <em>r</em> = + 1 compute the standard deviation of portfolio as follows:

\sigma_{P}=\sqrt{w^{2}_{1}\sigma_{1}^{2}+w^{2}_{2}\sigma_{2}^{2}+2\times r\times w_{1}\sigma_{1}w_{2}\sigma_{2}}\\=\sqrt{(0.30^{2}\times 0.51^{2})+(0.70^{2}\times 0.40^{2})+(2\times1\times0.30\times 0.51\times0.70\times 0.40)}\\=\sqrt{0.187489}\\=0.433

Thus, for correlation 1 the standard deviation of portfolio is 0.433.

(2)

For <em>r</em> = 0 compute the standard deviation of portfolio as follows:

\sigma_{P}=\sqrt{w^{2}_{1}\sigma_{1}^{2}+w^{2}_{2}\sigma_{2}^{2}+2\times r\times w_{1}\sigma_{1}w_{2}\sigma_{2}}\\=\sqrt{(0.30^{2}\times 0.51^{2})+(0.70^{2}\times 0.40^{2})+(2\times0\times0.30\times 0.51\times0.70\times 0.40)}\\=\sqrt{0.101809}\\=0.3191

Thus, for correlation 0 the standard deviation of portfolio is 0.3191.

(3)

For <em>r</em> = -1 compute the standard deviation of portfolio as follows:

\sigma_{P}=\sqrt{w^{2}_{1}\sigma_{1}^{2}+w^{2}_{2}\sigma_{2}^{2}+2\times r\times w_{1}\sigma_{1}w_{2}\sigma_{2}}\\=\sqrt{(0.30^{2}\times 0.51^{2})+(0.70^{2}\times 0.40^{2})+(2\times-1\times0.30\times 0.51\times0.70\times 0.40)}\\=\sqrt{0.016129}\\=0.127

Thus, for correlation -1 the standard deviation of portfolio is 0.127.

3 0
2 years ago
What factors of production will go into making the item
lukranit [14]
Production Capital, Human Capital, Resource Capital, and Intellectual Capital... 
Let me know if you need to know what those are :)
6 0
2 years ago
[The following information applies to the questions displayed below.]
Dvinal [7]

Answer:

                                  Allied Merchandisers

                                        Journal Entries

Date           General Journal                         Debit        Credit

03-May   Merchandise Inventory               $20,000

                     To Cash                                                     $20,000

05-May    Accounts Receivable                 $21,000

                      To Sales                                                    $21,000

05-May     Cost of goods sold                     $15,000

                     To Merchandise Inventory                        $15,000

07-May      Sales Returns and allowances   $1,750  

                      To Accounts Receivable                           $1,750

07-May      Merchandise Inventory               $1,250

                      To Cost of goods sold                                $1,250

08-May      Sales Returns and allowances    $300

                       To Accounts Receivable                            $300

15-May        Cash                                             $18,571

                   Sales Discounts                           $379

                    ($18950*2%)

                         To Accounts receivable                           $18,950

                          ($21000-$1750-$300)

8 0
3 years ago
\Currently the real interest rate is 1%. Expected inflation was initially 3% but rose to 6% as a result of the government's anno
ololo11 [35]

Answer:

Explanation:sorry dont report .y answer

7 0
2 years ago
Other questions:
  • U.S. Products operates two divisions with the following sales and expense information for the month of May: North Division: Sale
    7·1 answer
  • How does a traditional adversarial relationship with suppliers change when a firm decides to move to a few suppliers
    10·1 answer
  • Anderson Distribution Company has purchased 15 forklifts over the past two years. As it plans to place its next order for anothe
    11·1 answer
  • True or False: When economic profit is zero, producers do not have any incentive to deviate from the current line of production.
    5·1 answer
  • What is the net operating income for the month under absorption costing?
    15·1 answer
  • An estate provides a perpetuity with payments of X at the end of each year. Seth, Susan, and Lori share the perpetuity such that
    14·1 answer
  • The 5 C's of credit include: I. Collateral and Capacity II. Conditions, Capital and Consideration III. Collateral and Credit Sco
    6·1 answer
  • An organization increases its _____________ if it refuses to take measures—due care—to make sure that every employee knows what
    5·1 answer
  • Which of the following reflects the effect of the year-end adjusting entry to record estimated uncollectible accounts expense us
    14·1 answer
  • Asset 1 has an expected return of​ 10% and a standard deviation of​ 20%. Asset 2 has an expected return of​ 15% and a standard d
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!