« previous next »

Author Question: What is the relationship between interest rates and bond prices? Explain. What will be an ideal ... (Read 65 times)

Chloeellawright

  • Hero Member
  • *****
  • Posts: 588
on: Jul 1, 2018
What is the relationship between interest rates and bond prices? Explain.
 
  What will be an ideal response?

Question 2

Refer to Scenario 10.4. Given the information above, what are the profit maximizing number of tickets sold and the price of tickets?
 
  A) 0, 60
  B) 20,000, 50
  C) 40,000, 40
  D) 60,000, 30
  E) 80,000, 20


sarahccccc

  • Sr. Member
  • ****
  • Posts: 318
Reply #1 on: Jul 1, 2018
Answer to Question 1

There is an inverse relationship between bond prices and interest rates. A bond pays a fixed sum of money each year during its life. At a higher interest rate, the present value of the future payments declines, reducing the value of the bond.

Answer to Question 2

D


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

Vital signs (blood pressure, temperature, pulse rate, respiration rate) should be taken before any drug administration. Patients should be informed not to use tobacco or caffeine at least 30 minutes before their appointment.

Did you know?

According to the National Institute of Environmental Health Sciences, lung disease is the third leading killer in the United States, responsible for one in seven deaths. It is the leading cause of death among infants under the age of one year.

Did you know?

The first successful kidney transplant was performed in 1954 and occurred in Boston. A kidney from an identical twin was transplanted into his dying brother's body and was not rejected because it did not appear foreign to his body.

Did you know?

Bacteria have been found alive in a lake buried one half mile under ice in Antarctica.

Did you know?

Pubic lice (crabs) are usually spread through sexual contact. You cannot catch them by using a public toilet.

The accessory organs of the digestive system: the liver, gallbladder, and pancreas. Image shows the The accessory organs of the digestive system: the liver, gallbladder, and pancreas. Image shows the
Trans and cis isomers of a peptide bond involving the imino nitrogen of proline Trans and cis isomers of a peptide bond involving the imino nitrogen of proline
Infant Mortality Rates Worldwide Infant Mortality Rates Worldwide
Chlamydia Rates in Women Chlamydia Rates in Women
Relationship between Income Inequality and the Desired Tax Rate Relationship between Income Inequality and the Desired Tax Rate
Post-term birth rates, by province/territory, Canada Post-term birth rates, by province/territory, Canada
Video: Sex-Linked Traits! How are eye colors inherited in fruit flies?

For a complete list of videos, visit our video library