« previous next »

Author Question: The inflation risk premium on a bond is 2 percent, the U.S. T-bill rate is 5 percent, the maturity ... (Read 66 times)

justinmsk

  • Hero Member
  • *****
  • Posts: 524
on: Jul 11, 2018
The inflation risk premium on a bond is 2 percent, the U.S. T-bill rate is 5 percent, the maturity risk premium on the bond is 3 percent, the default risk premium on the bond is 2 percent, and the liquidity risk premium on the bond is 1 percent.
 
  Calculate its nominal rate of return.
  A) 16
  B) 13
  C) 11
  D) 9

Question 2

Both current and prospective shareholders are interested in the firm's current and future level of risk and return, which directly affect share price.
 
  Indicate whether the statement is true or false


juliaf

  • Sr. Member
  • ****
  • Posts: 344
Reply #1 on: Jul 11, 2018
Answer to Question 1

B

Answer to Question 2

TRUE


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

According to animal studies, the typical American diet is damaging to the liver and may result in allergies, low energy, digestive problems, and a lack of ability to detoxify harmful substances.

Did you know?

The horizontal fraction bar was introduced by the Arabs.

Did you know?

Adults are resistant to the bacterium that causes Botulism. These bacteria thrive in honey – therefore, honey should never be given to infants since their immune systems are not yet resistant.

Did you know?

Though the United States has largely rejected the metric system, it is used for currency, as in 100 pennies = 1 dollar. Previously, the British currency system was used, with measurements such as 12 pence to the shilling, and 20 shillings to the pound.

Did you know?

The senior population grows every year. Seniors older than 65 years of age now comprise more than 13% of the total population. However, women outlive men. In the 85-and-over age group, there are only 45 men to every 100 women.

Dual Systems Model of Risk-Taking Dual Systems Model of Risk-Taking
Risk Factors for Cardiovascular Disease Risk Factors for Cardiovascular Disease
How an Increase in Income Inequality Affects the Desired Tax Rate How an Increase in Income Inequality Affects the Desired Tax Rate
Fertility, Mortality, and the Net Rate of Reproduction in Sweden Fertility, Mortality, and the Net Rate of Reproduction in Sweden
Percentage of youth age 15 to 19 years with at-risk levels of body composition & fitness Percentage of youth age 15 to 19 years with at-risk levels of body composition & fitness
Increased Risk of Knee Osteoarthritis Increased Risk of Knee Osteoarthritis
Video: Monohybrid crosses

For a complete list of videos, visit our video library