What are the factors determining the changes in interest price and in what way? Analyze on a diagram of demand and supply of bonds.

Q: A bank pays one percent interest on savings account four times a year. What is the actual annual…

A: Interest rate is charged by the lender for using its money.

Q: 1.Which of the following is not a financial asset? a share of Coca-Cola stock a corporate bond an…

A: Introduction: Financial asset: A financial asset is a liquid asset with a contractual right or…

Q: Draw the demandand supply curves forthe bond market, andidentify the equilibrium interest rate.

A: The equilibrium interest rates for bonds can be determined when demand for and supply of bonds are…

Q: Suppose that you saved $4,700 at the beginning of the year and that at the end of the year your…

A: Present value is the value of investment in today's dollar.  Future value is the value of investment…

Q: Is it possible for a one-year coupon bond to have a negative nominal interest rate? Explain, how?

A: Yes, it is possible for a one-year coupon bond to have a negative nominal interest rate as long as…

Q: ______________ is a method of measuring the value of a section of the bond

A: In economic, bond market is referred to the place where exchange of bonds take place.

Q: Some people think that financialmarket transactions should be taxed. What are the arguments for and…

A: A financial transaction is a contract between a buyer and a seller to exchange goods, services, or…

Q: What type of bond is issued by state and local governments? Is there any risk that state and local…

A: An investor issues a bond to a borrower, such as a company or the government.The funds are used to…

Q: Draw the Yield curve for U.S. government bonds as it was on February 5th, 2020. Explain what is a…

A: The yield curve shows the yield to maturity. The yield derived for a maturity period is depicted in…

Q: on a supply and demand diagram for funds, show what happens to interest rates and explain what…

A: Demand curve is the downward sloping curve.  Supply curve is the upward sloping curve.  Equilibrium…

Q: What is an interest “reference rate,” and how is it used to set rates for individual borrowers?

A: Disclaimer: “Since you have asked multiple questions, we will solve the first question for you. If…

Q: what are bonds in the top four categories referred to?

A: Bond is generally a loan that is made by a borrower that is the company to an investor. It…

Q: 11. The face value of a bond is $10,000, and the annual coupon payment is $850. What is the coupon…

A: coupon rate is a rate  which is calculated by adding the sum of coupons paid per year and dividing…

Q: True or False: The time value of money describes how compound interest helps money grow over time. O…

A: Money is a resource or asset that is accepted and used as an exchange medium to buy commodities and…

Q: c. Small businesses use these to raise funds for investment. Loan | Stock | Bond d. This is also…

A: Loan: A loan is an agreement between borrower and lender that implies the borrower is borrowing a…

Q: Explain why a mortgage-backed security becomes riskier when the values of the underlying houses…

A: Mortgage-backed securities are more risky. The cost of borrowing is represented by interest…

Q: What is the relationship between a person’s need for payday lending and their income volatility?

A: Introduction In order to satisfy your immediate financial needs until the arrival of your next…

Q: at is a bond?     A certificate representing a loan from an investor to a corporation or…

A: A bond is a debt instrument that a business or government issues to raise funds, and pays fixed…

Q: What happened to credit standards(down payment, mortgage loan relative to value, and…

A: From the year 1995 to 2005, there were many changes in the real estate market. This led to a change…

Q: Draw the yield curve for u.s. government bonds as it was on february 5th 2020

A: Data for the calculation was taken from country U department of treasury official site, So the yield…

Q: Explain time and interest rate effect on future value?

A: Interest rate: It is the rate of earning in a specific time period on the investment.

Q: 1. What is an effective rate of interest?

A: The time value of money is the concept that an amount of money is worth more now than the same…

Q: Calculate the accrued interest (in $) and the total purchase price (in $) of the bond purchase.…

A: Given : Coupon rate=9.7% market price=79.75 Time period=23 days Commission per bond=$9.55 Bonds…

Q: Which type of security has interest payments that are generally exempt from federal income taxes?…

A: T-bonds or Treasury bonds are fixed-rate government debt security by the U.S. with maturity mostly…

Q: What might cause interest rates to be low one year and high the next?

A: Interest rates are best thought of as the "cost of money." If a borrower wishes to spend more money…

Q: Why are bonds somewhat risky to buy, even though they make predetermined payments based on a fixed…

A: Financial economics deals with the financial markets, their operations and functions, and the…

Q: You own a 6%bond and want to sell it in a yearl Di you hope that interest rates rise or fall?…

A: there are a lot of signals where we can say that we have to sell the bond.

Q: Which of the following is a personal financial asset? a. A payday loan b. A mortgage loan c. A…

A: A financial asset is a tradable instrument or other tangible property that represents a legal claim…

Q: 1. A bank is offering to sell four-month certificates of deposit for $ 4,926. At the end of four…

A: A bank is offering to sell four-month certificates of deposit for $ 4,926. At the end of four…

Q: Annuity Suppose that you are thinking of buying a car that yields a rental of $5,000 each year for 3…

A: To determine how much you should be willing to pay for the car, we can calculate the present value…

Q: Explain what is interest Rate Swaps (IRS) and Who are the parties in an IRS.

A: Interest rate swaps (IRSs) are interest rate derivatives in the financial industry (IRD).  It's a…

Q: If junk bonds are called "Junk" Why then would as an investor buy Junk bonds?   Explain your reasons…

A: Junk bonds are bonds which carry a higher default risk than most corporate and government issued…

Q: What are the factors affecting the amount of money paid for the use of borrowed capital or the…

A: In a capital market, organizations raise capital/funds by borrowing money from the market…

Q: What causes the yield on a discount bond to exceed the coupon rate on a bond?

A: The markets are the place where the buyers of the goods, services, and products tend to meet and…

Q: Economics - Chapter 11 Section Review WHAT STEPS WOULD YOU TAKE TO PURCHASE A BOND AND HOw WOULD YOU…

A: A bond is a fixed-income security that reflects a loan from an investor to a borrower (corporation…

Q: Kuwait was recently able to reduce its budget deficit. What will be the impact of this event on bond…

A: Budget deficit: ​A spending deficiency is when spending surpasses pay. The term applies to…

Q: What are the three most important personal factors and the three most important economic factors…

A: The fundamental goal of the financial planning process is to manage and evaluate how best to use…

Q: Arjay plans to sell a bond that matures in one year and has a principal value of $1,000. Can he…

A: Bonds refer to investment instruments that are invested in with the aim of earning a return at a…

Q: You buy a bond that has an annual interest rate of 2 percent and a coupon of $4. What is the price…

A: Given information: The annual interest rate is 2 percent The coupon on the bond is $4 There is an…

Q: What are the requirements that a company must have, in order to insert in Borsa Italiana stock…

A: Companies of all sizes can use the Borsa Italiana stock exchange to generate considerable funds to…

Q: What is the current price of a $1,000 discount bond that matures in 5 years if the yield to maturity…

A: As it is given in the question that Time n=5 YTMR = 5% current price =$1,000