« previous next »

Author Question: What is the relationship between interest rates and bond prices? Explain. What will be an ideal ... (Read 81 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?

Between 1999 and 2012, American adults with high total cholesterol decreased from 18.3% to 12.9%

Did you know?

There used to be a metric calendar, as well as metric clocks. The metric calendar, or "French Republican Calendar" divided the year into 12 months, but each month was divided into three 10-day weeks. Each day had 10 decimal hours. Each hour had 100 decimal minutes. Due to lack of popularity, the metric clocks and calendars were ended in 1795, three years after they had been first marketed.

Did you know?

There can actually be a 25-hour time difference between certain locations in the world. The International Date Line passes between the islands of Samoa and American Samoa. It is not a straight line, but "zig-zags" around various island chains. Therefore, Samoa and nearby islands have one date, while American Samoa and nearby islands are one day behind. Daylight saving time is used in some islands, but not in others—further shifting the hours out of sync with natural time.

Did you know?

For high blood pressure (hypertension), a new class of drug, called a vasopeptidase blocker (inhibitor), has been developed. It decreases blood pressure by simultaneously dilating the peripheral arteries and increasing the body's loss of salt.

Did you know?

Looking at the sun may not only cause headache and distort your vision temporarily, but it can also cause permanent eye damage. Any exposure to sunlight adds to the cumulative effects of ultraviolet (UV) radiation on your eyes. UV exposure has been linked to eye disorders such as macular degeneration, solar retinitis, and corneal dystrophies.

The Relationship Between Religion and Spirituality The Relationship Between Religion and Spirituality
Blood pressure and blood volume relationship Blood pressure and blood volume relationship
Hydrogen Bond Hydrogen Bond
Relationship between Income and Happiness in the United States Relationship between Income and Happiness in the United States
A very light ideal spring stretches by when it is used to hang a 135-N object. What is the ... A very light ideal spring stretches by when it is used to hang a 135-N object. What is the ...
Relationship between birth weight and mortality in humans Relationship between birth weight and mortality in humans
Video: Resting membrane potential - electrical polarity and maintenance requirements

For a complete list of videos, visit our video library