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Answer:
A <u>SUBPRIME</u> borrower is a borrower with a flawed credit history and an <u>ALT-A BORROWER</u> is a borrower who states his or her income but does not document or prove the amount of income.
Explanation:
Subprime borrowers are borrowers that have a bad credit score and because of this, any bank or other lending institution will either reject them as clients or charge them a really high interest rate on a loan.
An Alt-A borrower is in the middle between a prime borrower (good credit score) and a subprime borrower. He/she will not get rejected as often, but the interest rates will still be relatively high and the amounts of money borrowed tend to be smaller than prime borrowers. Some companies like Fannie Mae or Freddie Mac do not accept Alt-A borrowers, but most banks do.
Answer:
1. Debt–equity ratio = 1.78
2. Equity multiplier = 2.78
Explanation:
Total Debt Ratio = 0.64
Total Debt Ratio = Total Debt / Total Asset
0.64 = Total Debt / Total Asset
Considering asset = 1
0.64 = Total Debt / 1
Total Debt = 0.64 x 1
Total Debt = 0.64
According Accounting Equation
Assets = Equity + Liabilities
Equity = Assets - Liabilities
Equity = 1 - 0.64
Equity = 0.36
Now Calculate Debt equity ratio
Debt Equity Ratio = Total Debt / Total Equity
Debt Equity Ratio = 0.64 / 0.36
Debt Equity Ratio = 1.78 = 178%
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Equity Multiplier = Total Asset / Total Equity
Equity Multiplier = 1 / 0.36 = 2.78 = 278%
Answer:
supply.
Explanation:
Supply is the volume or quantity of a product that is available for customers to buy. It is what suppliers have presented in the markets for sale. As per the supply law, an increase in prices will lead to an increase in the quantity supplied.
There can be a shortage, excess, or equilibrium supply. A short supply or shortage is when the available products cannot meet the current market demand. An excess or surplus supply is when the available quantity is more than the market requires. At equilibrium, the supply matches the market demand.