What does the Canada yield curve represent? Multiple choice question. The changes in the yield on corporate bonds over time The yields on government notes and bonds relative to maturity The changes in the yield on the equity and bonds of a corporation over time The difference between the yield on government bonds and corporate bonds
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What does the Canada yield curve represent?
The changes in the yield on corporate bonds over time
The yields on government notes and bonds relative to maturity
The changes in the yield on the equity and bonds of a corporation over time
The difference between the yield on government bonds and corporate bonds
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- What do bond ratings reflect? Multiple choice question. The ability of a firm to repay its debt and interest on time The number of bonds issued by a corporation since its initial public offerings (IPO) The quality of a firm's bonds relative to its competitors The debt-equity ratio for the current year1) Expectations of asset values by participants in financial markets 2) When market participants use all available information 3) Which of the following is NOT a way in which prices communicate information in the markets for bonds, stocks, foreign exchange, and financial instruments? 4) The gap between the yield on a corporate bond and the yield on a U.S. Treasury bond of the same maturity represents 5) If the interest rate on a ten-year bond issued by GM is 7.8% while the interest rate on a ten-year treasury bond is 4.6%, the risk premium is 6) If the dollar is expected to depreciate against the Japanese yen during the next 60 days, then 7) If the dollar is expected to depreciate against the British pound during the next 60 days, then 8) When the market price of a financial instrument equals its present value, savers and borrower can be sure that 9) If a company's sales begin to fall off so that it is now more likely to default on its bonds than financial markets had…A plot of the yields on Government of Canada notes and bonds relative to maturity is called Blank______. Multiple choice question. Canada yield curve yield to maturity default risk premium graph Canada plus call
- What is the main reason for the yield differences between treasury bond yield and corporate bond yield? a. Credit risk b. Systemic Risk c. Liquidity risk d. Interest rate riskDoes a large national debt impact the stock market?What is the difference in the interest rates on commercial paper for financial firms versus nonfinancial firms? Explain possible reasons for the difference. What is the most recent interest rate reported for, 1-year, 2-year, 5-year, 10-year, and 30-year maturity Treasuries? Provide the graph of the rates over the maturity (the yield curve) and interpret the shape of the yield curve. 2. The most famous financial market in the world is the New York Stock Exchange (NYSE). Visit the NYSE website and then answer the following questions: ● What is the mission of the NYSE? ● What would be the fee for a firm with five million common shares outstanding?
- Refer to Table 12.2. a. What is the historical real return on long-term government bonds? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What is the historical real return on long-term corporate bonds? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) TABLE 12.2 Average Annual Returns: 1926-2019 Investment Average Return Large-company stocks 12.1% Small-company stocks 16.3 Long-term corporate bonds 6.4 Long-term government bonds 6.0 U.S. Treasury bills 3.4 Inflation 2.9 Source: 2020 SBBI Yearbook. Duff & Phelps.how Will long term bonds effect current ratio, acid test ratio, and debt to equity ratio? how will purchase inventory effect Current ratio, acid test ratio, debt to equity ratio? how will these effect the ratios mention above: retirement of bonds, sale of common stock, purchase of short-term investment for cash, and decision to refinance on a long term basis some currently maturing debt? ,Explain why a positive yield spread typically exists between government and corporate bonds of the same maturity and liquidity. What factors determine its magnitude?
- The time value of money is used in calculating bond prices because: Group of answer choices A - The company might choose to repay the bonds prior to their maturity date B - Bond investors receive future payments and purchase bonds with current dollars C - The amount to be repaid at maturity will change as market rates change D - Cash interest payments to bondholders will change as market rates changeWhich one of the following is a correct ranking of securities based on their volatility over a very long-term period? Rank from highest to lowest. - large company stocks, U.S. Treasury bills, long-term government bonds - small company stocks, long-term corporate bonds, large company stocks - small company stocks, long-term corporate bonds, intermediate-term government bonds - large company stocks, small company stocks, long-term government bonds - intermediate-term government bonds, long-term corporate bonds, U.S. Treasury billsWhich of the following statements is CORRECT? Group of answer choices The bond-yield-plus-risk-premium approach to estimating the cost of common equity involves adding a risk premium to the interest rate on the company’s own long-term bonds. The size of the risk premium for bonds with different ratings is published daily in The Wall Street Journal or is available online. The WACC is calculated using a before-tax cost for debt that is equal to the interest rate that must be paid on new debt, along with the after-tax costs for common stock and for preferred stock if it is used. An increase in the risk-free rate is likely to reduce the marginal costs of both debt and equity. The relevant WACC can change depending on the amount of funds a firm raises during a given year. Moreover, the WACC at each level of funds raised is a weighted average of the marginal costs of each capital component, with the weights based on the firm’s target capital structure. Beta measures market risk,…