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2 years ago

How do bonds earn income

Business

1 answer:

mario62 [17]2 years ago

8 0

Answer:

The owner of the bond receives interest payments, known as the coupon, throughout the life of a bond, at the interest rate that was determined when it was issued.

Explanation:

They are debt obligations, meaning that the investor loans a sum of money (the principal) to a company or a government for a set period of time, and in return receives a series of interest payments (the yield).

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_____________segmentation differentiates among heavy users, medium users, light users, and nonusers of a specific product, servi

tatiyna

Usage rate segmentation differentiates among heavy users, medium users, light users, and nonusers of a specific product, service, or brand.

A rate is a special ratio in which the two terms are in different units. For example, if a 12 oz can of corn costs 69 cents, the price is 69 cents for 12 oz. This is not a ratio of two equal units, such as B. Shirt. It is the ratio of two unequal units: cents and ounces.

A rate is a ratio that compares quantities in different units. Fees are common in everyday life. Grocery and department store prices are approximate. Tariffs are also used to pay for gasoline, tickets to movies and sporting events, and hourly and monthly fees.

Learn more about rate here

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7 0

1 year ago

4. Read the scenario below and explain to the

erik [133]

Answer:

Whaa happened frann lol

Explanation:

8 0

2 years ago

You can invest in an account that pays simple interest or an account that pays compound interest. In either case, you plan to in

trasher [3.6K]

Answer:

You will receive $201.38 more interest if the investment is made with a compound interest rate rather than a simple interest rate.

Explanation:

Simple interest rate

We can calculate how much interests you'd obtain if you deposited the $2,600 in a simple interest rate account.

We start using the following formula for calculating the simple interests:

$I=P * r$

Where:

I are the interests per year,

P is the amount being invested,

r is the interest rate.

Replacing in the formula with the given values we have:

$I=2600*0.05=130$

We then proceed to multiply this result by the given number of years, which is 8. We get $130*8=1040$ .

Finishing with the simple interest rate, if we wanted to know how much is the investment worth at the end of a 8 year period, we must merely add the principal (the $2,600) to the total interests after the end of the period ($1040). So $2600+1040= 3640$ .

We'll use these results later.

Compound interest rate

The formula for compound interests is the following:

$I=P(1+r)^n$

Where:

I is the value of the investment after n years,

P is the principal amount being invested,

r is the interest rate,

n are the number of years the investment is compounded.

Replacing in the formula with the given values we have:

$I=2600*(1+0.05)^8=3841.38$

After the 8 year period, the investor will have $3841.38 in it's compounded interest account.

Comparing these results

We can simply substract the value of both investments at the end of a 8 year period, to determine how much more interest does the compound interest rate account give in relation to a simple interest rate account.

The values we've gotten were:

$3,640 for the simple interest rate account, and

$3,841.38 for the compounded interest rate account.

$3841.38-3640=201.38$ . Therefore the answer is: the account that pays compounded interests will pay $201.38 more to this invididual, compared to an account that pays simple interest.

8 0

3 years ago

An economy is experiencing a recessionary gap. The government can ______.

Jobisdone [24]

Answer:

Increase expenditure or cut taxes to increase aggregate demand.

Explanation:

A recessionary gap is a macroeconomic term which portrays an economy working at a level underneath its full-employment equilibrium. Under a recessionary gap condition, the degree of real gross domestic product (GDP) is lower than the degree of full employment, which puts descending pressure on prices over the long haul.

6 0

3 years ago

Real estate is a great investment for everyone, particularly since the money is more liquid than common stocks. true or false

Musya8 [376]

this assumption is false. Liquidity of money refers to the ease with which the owner of an asset can convert it into cash. it is easier to convert common stocks into cash rather than attempt to raise cash from sale or mortgage of real estate assets.

4 0

2 years ago

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