« previous next »

Author Question: Explain liquidity, default risk, and maturity risk premiums. What will be an ideal ... (Read 60 times)

abern

  • Hero Member
  • *****
  • Posts: 533
on: Jul 11, 2018
Explain liquidity, default risk, and maturity risk premiums.
 
  What will be an ideal response?

Question 2

Which of the following is true of benchmarking?
 
  A) It is an analysis in which a firm's ratio values are analyzed to project the fundamental values of the assets for upcoming years or business cycle.
  B) It is an analysis in which a firm's ratio values are compared with those of a key competitor or with a group of competitors that it wishes to emulate.
  C) It is an analysis in which a firm's financial performance over time is evaluated using financial ratio analysis.
  D) It is a financial statement analysis technique which combines cross-sectional and time-series analyses.


otokexnaru

  • Sr. Member
  • ****
  • Posts: 314
Reply #1 on: Jul 11, 2018
Answer to Question 1

Liquidity problems exist in thinly traded bonds, default risk is the likelihood the corporation will default on its bond obligations, and the maturity risk reflects the fact that longer-term bonds possess greater interest rate risk and sensitivity than shorter term bonds. If any of these exists, investors will demand compensation for the risk by demanding a yield premium to own the bonds.

Answer to Question 2

B


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

There are 20 feet of blood vessels in each square inch of human skin.

Did you know?

Giardia is one of the most common intestinal parasites worldwide, and infects up to 20% of the world population, mostly in poorer countries with inadequate sanitation. Infections are most common in children, though chronic Giardia is more common in adults.

Did you know?

About 600,000 particles of skin are shed every hour by each human. If you live to age 70 years, you have shed 105 pounds of dead skin.

Did you know?

Illness; diuretics; laxative abuse; hot weather; exercise; sweating; caffeine; alcoholic beverages; starvation diets; inadequate carbohydrate consumption; and diets high in protein, salt, or fiber can cause people to become dehydrated.

Did you know?

Many supplement containers do not even contain what their labels say. There are many documented reports of products containing much less, or more, that what is listed on their labels. They may also contain undisclosed prescription drugs and even contaminants.

Risk Factors for Developing Breast Cancer Risk Factors for Developing Breast Cancer
The Number of Children Americans Think Are Ideal The Number of Children Americans Think Are Ideal
Suggested Antibiotic Prophylaxis Regimens in Patients at Potential Increased Risk of Hematogenous ... Suggested Antibiotic Prophylaxis Regimens in Patients at Potential Increased Risk of Hematogenous ...
Vial Washing System - Risk Based Approach Vial Washing System - Risk Based Approach
The relationship between maternal age and the frequency of trisomy 21 (Down syndrome). The risk incr The relationship between maternal age and the frequency of trisomy 21 (Down syndrome). The risk incr
After 159 days,she paid a maturity value of $11,626, which included interest of $814. After 159 days,she paid a maturity value of $11,626, which included interest of $814.
Video: Inflammatory response Animation

For a complete list of videos, visit our video library