The spread between the interest rates on bonds with default risk and default-free bonds is called the risk premium.
A default-free bond is a bond in which the bond issuer would not miss scheduled payments of either the coupon or principal. Bonds issued by the government are generally considered to be default-free. This is because the government can print money to make payments.
A bond with a default risk is a bond in which the bond issuer can miss scheduled payments of either the coupon or the principal. Bonds issued by private individuals are generally considered to be bonds with default risk.
Bondholders usually demand a compensation for holding bonds with a default risk. This compensation is known as risk premium.
Risk premium = return on bonds with default risk - return on default- free bond.
To learn more, please check: brainly.com/question/4304080?referrer=searchResults
Answer:
a) Distinguish between the use of Franchising and Joint Venture as modes of entry into other countries by global businesses.
Franchising consists in the licensing of aspects of production and intellectual property to a another party: the franchise.
A Joint Venture is a business union between two or more parties, in which they split profit as well as costs and responsabilities.
b) What are the respective advantages and disadvantages of both strategies?
Franchising can be a quicker way to expand into foreign markets. The flexibility of the method, and the lower capital requirements are the reason why. This can be seen in the success that American fast-food brands have had using this method to expand in global markets.
A Joint-Venture can be more difficult to use for market expansion, however, it can be more profitable, because the profit will not be split among as many parties as in franchising, and more importantly, the firm maintains a higher control of the operation.
Answer:
C, Raises aggregate expenditure by raising liable income, thereby increasing consumption.
Explanation:
Tax is a very important financial tool of any governmet to ensure its smooth running.
Tax can either be increased or decreased and each of these acts have their effects on the the counrty and on its people. For the purpose of this question, i will be sticking to tax decrease.
Tax decrease as the name implies is the reduction of taxes paid by individuals to the government from their taxable incomes.
When tax is reduced, there is a little more money for the people to spend and as such this affects the demand, consumption (of goods) as well as the gross domestic profit; GDP, of the country.
When the people have more money to spend, there is an increase in things they buy, wear, do, etc and so production in that country becomes high.
Tax decrease is most effective in a situations where there is high level of unemployment and slow paced economies.
cheers.
Answer by JKismyhusbandbae: They get paid due to the amount of houses they sell and how big and worth the house is. Although real estate agents make money through commissions paid directly to brokers when transactions are settled.
The relationship between risk and expected return serves to allocate capital in a market. Investors want to maximize return for a given level of risk, so capital flows to its most efficient use.
There is a positive correlation between the level of risk taken and the level of return expected. The greater the risk, the greater the expected return and the greater the likelihood of suffering a large loss.
The relationship between risk and expected return is called the risk-return relationship. This is a positive relationship because the more risk you take, the higher the required return that most people demand. Risk aversion describes a positive risk-reward ratio.
Learn more about risk and expected return at
brainly.com/question/25821437
#SPJ4
