Suppose Baa-rated bonds currently yield 6%, while Aa-rated bonds yield 4%. Now suppose that due to an increase in the expected inflation rate, the yields on both bonds increase by 1%. What would happen to the confidence index? (Round your answers to 4 decimal places.)

Answers

Answer 1

Answer:

Initial confidence index 66.67%

New confidence index 71.4%

Explanation:

Calculation of what would happen to the

confidence index

Using this formula

Confidence index=(Average yield for high grate bonds)/(Average yield for intermediate graded bonds)

Let plug in the formula

Initial confidence index=4%/6%

=0.6667 ×100

=66.67%

Due to increase in the yields the New Confidence Index will be;

New confidence index

=(4%+1%)/(6%+1%)

=5%/7%=0.7142857 or 0.714

0.714×100=71.4%

Hence, the New Confidence index tend to indicates slightly higher confidence and the reason for the increase in the index is the expectation of higher inflation.


Related Questions

Why is the price floor above the equilibrium point and the price ceiling below the equilibrium point? Please explain as well!

Answers

Answer:

THE GIVEN STATEMENT IS WRONG.

The prices and the quantities of the products are usually set up by considering demand and supply. Sometimes, people may not agree with the price of a certain thing. Due to these reason, the government may set a maximum and minimum price limits on a product so it always remains in a certain range.

The upper limit is Price Ceiling. When a Price Ceiling is set below the equilibrium point, the demand will exceed the supply and shortages will occur.

The lower limit is Price Floor. When a price floor is set above the equilibrium point, the supply will exceed the demand, resulting in surplus quantity of a product

9. Which of the following can demagnetize a magnet?
(A). Hanging it North-South direction (D). Heating and hammering it
(B). Using it in dynamo
(E). Using it in radio speaker
(C). Putting it in water

Answers

Answer:

option D is correct.....

The Cash account of Gate City Security Systems reported a balance of 2400 at December 31​, 2018. There were outstanding checks totaling 1300 and a December 31 deposit in transit of 400. The bank​ statement, which came from Tri Cities​ Bank, listed the December 31 balance of 3810. Included in the bank balance was a collection of 520 on account from Carol Lajoy​, a Gate City customer who pays the bank directly. The bank statement also shows a 30 service charge and 20 of interest revenue that Gate City earned on its bank balance. Prepare Gate City​'s bank reconciliation at December 31.

Answers

Answer:

Explanation:

gate City bank reconciliation statement as at December 31, 2018

Balance as per cash book                                 2400            

Direct payment to the bank (loan)        520            

Less bank charges                                   (30)                      

Add bank interest                                      20

Adjustment                                                              510

Adjusted cash book balance                                  2910

Balance as per bank statement                            3,810

Less outstanding check                            (1300)

Add deposit in transit                                   400

Adjustment                                                               (900)

Adjusted bank statement balance                          2,910    

Early on in an amortized loan the interest portion of each payment is typically ______ than the principle portion. Towards the end of the loan term the interest portion of each payment is typically ______ than the principle portion. This is because the principle remaining _______ over the life of the loan. A) less / greater / increases B) greater / less / increases C) greater / less / decreases D) less / greater / decreases

Answers

Answer:

C

Explanation:

An amortized loan is a form of loan which the principle together with the accrued interest component is gradually written off over an agreed period of time at a specified rate.An equal amount is regularly paid over the extended period.

The interest component of an amortized loan is firstly settled before considering the principle amount , which makes the interest component to be higher that the principle at the initial stages. This process leads to a reduction in the volume of the principle balance with time . Moreover , as the principle reduces with time , the interest expenses also reduces , and it eventually gets to a point where the principle component of repayment becomes greater.

Who owns the factors of production?

Answers

Answer: factors of production, such as land and capital, is owned by workers.

hope this helped ;)

What personnel records would you suggest for a small retailer with three employees?

Answers

Explanation:

For a small retailer with three employees, the ideal would be to keep personnel records well organized, because regardless of the size of the company, the records function as a perspective of the human resources department and a protection for the company, therefore it is essential that the company have registration forms, selection data, evaluation reports, disciplinary forms, job description, social security number, etc.

If the exchange rate between the u.s. dollar and the Canadian dollar is 1:1.3, which of the following is true

Answers

Answer:

It will cost less to buy a $5 item in Canada than it will in the United States

Explanation:

if the exchange rate between the US Dollar and the canadian dollar is 1:1.3, then that menas that it would be easier to buy a commodity of $5 in canada as against buying in the US. This is because the price of the commodities will be affected by the exchange rate thus price making room for a 0.13

Cheers

What are the advantages and disadvantages of the three primary business writing formats?

Answers

Answer and Explanation:

The business writing formats benefits and disadvantages of the three primary business writing formats are described below:-

A memorandum is a formal define that it is the way of communication that enables corporations to connect with their workers. This is typically used to distribute updates or issues.

Memos are highly increasingly being replaced by e-mail, so sending a memo is more difficult and costly. Therefore, a Business Letter is a structured communication method that's best used to connect with clients.

It generally takes more time to write and format a business letter than to write an email or memo.

As we know that an Email is easy to send and priceless, and make enable to send message to many people at a time also Many unwritten e-mails etiquette rules and can be too casual for many business purposes.

Business writing formats includes the use of memorandum, email business letters etc. The advantages and disadvantages of the three primary business writing formats are:

A Memorandum: (Advantages)

This is simply a formal, internal communication tool which allows companies to communicate with their employees. It is known to be used to deliver announcements or problems.

Disadvantages

Memos are said to be rapidly been replaced by e-mail due to the fact that it is more complicated and expensive to deliver a memo.

Business letters (Advantages)

A Business Letter is simply known as a formal communication tool which is utilized for communicating with customers.

Disadvantages

Writing and formatting a business letter often takes more time than composing a memo or e-mail.

Emails (Advantages)

E-mail is quick, easy and cheap, and allows you to send messages instantly to any number of people.

Disadvantages

E-mail has too much unwritten rules  to follow (etiquette) and it is too informal for many business purposes.

Learn more from

https://brainly.com/question/9510322

By agreeing to work together, either formally or informally, oligopolies in a market can ________ profits by reducing output and charging a ________ price which is much like a monopoly.

Answers

Answer:

increase, high.

Explanation:

By agreeing to work together, either formally or informally, oligopolies in a market can increase profits by reducing output and charging a high price which is much like a monopoly. When firms form an oligarchy in a market to reduce output and keep prices high, it is called collusion. They more or less become like a monopolistic entity as they collude together to reduce output and demand an agreed higher price.

Mr. X and Y are having a discussion. Mr. X felt that business is based on selfish desires to gain higher and higher profits while Mr. Y felt that profit is essential for business. Can you support Mr. Y's case by providing strong points for his favour.

Answers

Answer: Ensure running cost is maintained to sustain business.

Explanation:

Resources to drive the business; probably the capital to start the business ain't much to cover for the production of more products or to cover for other expenses, here there would be a valid point for an increase in finances in some areas which won't be based on greed or selfishness. The running cost of a business matters, so the business doesn't crumble or there isn't enough return on investment.

Kristoffer needs to create cell names that match the column headings he has already created. Select the correct navigational path to set those names using the Create from Selection command. Click on the tab on the ribbon and look in the Defined Names gallery.

Answers

Answer:

formula

create from selection

top row

Explanation:

just took the question on edge

The correct navigational path to create cell names that match the column heading using the Create from Selection command is: Click on the Formula tab on the ribbon and look in the Defined Names gallery. Select the range of cells, including the row that includes the name you wish to use. Select Create from Selection. Select Top row and click OK.

What is a cell?

Cells are the boxes that appear in an Excel worksheet's grid. On a worksheet, each cell is identified by its reference, the column letter and row number that intersect at the cell's location.

Instead of creating cell names one by one, "Create from Selection" tool can be used to create cell names from a selection. The tool is in the "Defined Names" group of the Formulas menu.

Therefore, the correct path for using the Create from Selection command is first to click on  Formula tab and look in the Defined Names gallery. Then select the range of cells, including the row that includes the name  wish to use. Select Create from Selection. Select Top row and click OK.

To learn more about cell, click here:

https://brainly.com/question/1380185

#SPJ6

Manton Manufacturing applies manufacturing overhead costs to products at a budgeted indirect-cost rate of $60 per direct manufacturing labor-hour. A retail outlet has requested a bid on a special order of the Toy Bear product. Estimates for this order include: Direct materials of $79,000; 680 direct manufacturing labor-hours at $25 per hour; and a 25% markup rate on total manufacturing costs. Manufacturing overhead cost estimates for this special-order total ________.

Answers

Answer: $40,800

Explanation:

Given the following :

Indirect cost rate = $60 per direct manufacturing labor-hour

Total direct manufacturing labor-hour of special order = 680

Thus means that the Indirect cost or overhead associated with the manufacture of the special order is :

(Total direct manufacturing labor-hour × Indirect cost per direct manufacturing labor-hour)

= (680 labor-hours × $60)

= $40,800

Therefore, Manufacturing overhead cost estimates for this special-order total is $40,800.

This year Truckit reported taxable income of $160,000 and received $20,000 of municipal interest. Truckit paid $55,000 in entertainment expenses and $15,000 in fines and penalties Truckit had $50,000 of accumulated E&P at the beginning of the year. What is Truckit’s current E&P?

Answers

Answer: $76,400

Explanation:

GIVEN THE FOLLOWING :

TAXABLE INCOME = $160,000

MUNICIPAL INTEREST = $20,000

ENTERTAINMENT EXPENSE = $55,000

FUN.

CURRENT E&P = (taxable income + interest) - (expenses + Tax deduction).

CURRENT E&P = $160,000 + $20000 - (55000 + 15000 + (160,000*0.21))

CURRENT E&P = 160000 + 20000 - 55000 - 15000 - 33600)

THEREFORE CURRENT E&P = $76,400

Do you think a luxury brand can ever be called good value? Explain your answer


yes like sometimes because in quality or the design and Makes something good.

Answers

I do believe luxurious brands are very picky with there titles

Match the given situations to the risks faced by the business. economic risks, natural disasters, right product, operations risk, due to inefficiency of management, the business plan has failed, the finance team has misjudged the requirement of the business plan and chosen a wrong line of credit, flash floods have damaged all machinery in the main manufacturing unit, and there have been foreign exchange rate fluctuations.

Answers

Answer:

Economic risks - there have been foreign exchange rate fluctuations.

Foreign exchange rate fluctuations are an economic risk, and they can represent a significant risk for many companies, for example, for companies that import or export goods.

Natural disasters - flash floods have damaged all machinery in the main manufacturing unit

Flash floods occur when a lot of rain falls in a very short period of time. They are a type of natural disaster.

Right product risk - the finance team has misjudged the requirement of the business plan and chosen a wrong line of credit

In this case, the company experienced the risk of choosing the right product or not, with the adverse effect that it did not choose it.

Operations risk - the business plan has failed

The goal of a business operation is to carry out the business plan, if the daily operations of the business fail to fulfill the business plan, then, the company has incurred in operations risk.

Other Questions
Jane Eyreby Charlotte Bronte (excerpt)Long did the hours seem while I waited the departure of the company, and listened for the sound of Bessie's step on the stairs, sometimes she wouldcome up in the interval to seek her thimble or her scissors, or perhaps to bring me something by way of supper-a bun or a cheese-cake-then shewould sit on the bed while I ate it, and when I had finished, she would tuck the dothes round me, and twice she kissed me, and said, "Good nightMiss Jane. When thus gentle, Bessie seemed to me the best. prettiest, kindest being in the world, and I wished most intensely that she would alwaysbe so pleasant and amiable, and never push me about or scold, or task me unreasonably, as she was too often wont to do. Bessie Lee must, I think.have been a girl of good natural capacity, for she was smart in all she did, and had a remarkable knack of narrative; so, at least, I judge from theimpression made on me by her nursery tales.2Select the correct answerWhich word best describes the author's tone in this excerpt?OAironic .indignant .admiringODdejected Emily is considering purchasing a new home for $400,000. She intends to put 20% down and finance $320,000, but is unsure which financing option to select. Emily is considering the following options: o Option 1: Fixed rate mortgage over 30 years at 8% interest, zero points, or o Option 2: Fixed rate mortgage over 30 years at 4% interest, plus two discount points. How long would her financial planner recommend that she live in the house to break even using Option 2 presuming she is not financing the points A car can travel 45 miles on 2 gallons of gasoline. How far can it travel on 5.6gallons? An Undergraduate Study Committee of 6 members at a major university is to be formed from a pool of faculty of 18 men and 6 women. If the committee members are chosen randomly, what is the probability that precisely half of the members will be women? In the long run, profits in a monopolistically competitive market are zero because: a. of government regulations. b. of collusion. c. firms are free to enter and exit the market. d. firms produce a differentiated product. Select the correct answer. What is the domain of the function represented by this graph? An equilateral triangle has an altitude of 4.8in. What are the length of the sides? Round to the nearest tenth. This passage from chapter 4 of The Story of My Life is an example of whchstage of plot?The most important day I remember in all my life is the oneon which my teacher, Anne Mansfield Sullivan, came tome. I am filled with wonder when I consider theimmeasurable contrasts between the two lives which itconnects. It was the third of March, 1887, three monthsbefore I was seven years old.O A. ConflictO B. ExpositionO c. ClimaxO D. Conclusion Immediately outside a conducting sphere(i.e. on the surface) of unknown charge Q and radius R the electric potential is 190 V, and 10.0 cm further from the sphere, the potential is 140 V. What is the magnitude of the charge Q on the sphere 3. Factor the expression.d2 + 120 + 36A (d + 6)2B (d - 36)(0 - 1)OC (d - 6)2D (d + 6)(d - 6) What device is used in the statement The crowd roared in the final paragraph?a.) alliteration b.) onomatopoeia c.) personification d.) simile A chemistry student in lab needs to fill a temperature-control tank with water. The tank measures 24.0 cm long by 21.0 cm wide by 13.0 cm deep.In addition, as shown in the sketch below, the student needs to allow 2.0 cm between the top of the tank and the top of the water, and a round-bottom flaskwith a diameter of 10.5 cm will be just barely submerged in the water.Calculate the volume of water in liters which the student needs. Round your answer to the nearest 0.1 L. ol.2 cmMflaskOL6water The manager of a coffee shop wants to know if his customers drink preferences have changed in the past year. He knows that last year the preferences followed the following proportions 34% Americano, 21% Cappuccino, 14% Espresso, 11% Latte, 10% Macchiato, 10% Other. In a random sample of 450 customers, he finds that 115 ordered Americanos, 88 ordered Cappuccinos, 69 ordered Espressos, 59 ordered Lattes, 44 ordered Macchiatos, and the rest ordered something in the Other category. Run a Goodness of Fit test to determine whether or not drink preferences have changed at his coffee shop. Use a 0.05 level of significance. AmericanosCapp.EspressoLattesMacchiatosOther Observed Counts1158869594475 Expected Counts15394.56349.54545 Enter the p-value - round to 5 decimal places. Make sure you put a 0 in front of the decimal. P-value = Empathy is challenging for many because it doesnt ____ But It does___ What is the conjugate of 3+3i? Assume a company pays tax at a rate of 15% on its first $50,000 of income. Any income above $50,000 is taxed at 25%. If a company has $75,000 of taxable income, which of the following statements is correct?a. Its marginal tax rate is 15%. b. Its average tax rate is 25%. c. Its marginal tax rate is 18.33%. d. Its average tax rate is 18.33%. Paladin Furnishings generated $4 million in sales during 2016, and its year-end total assets were $2.4 million. Also, at year-end 2016, current liabilities were $500,000, consisting of $200,000 of notes payable, $200,000 of accounts payable, and $100,000 of accrued liabilities. Looking ahead to 2017, the company estimates that its assets must increase by $0.60 for every $1.00 increase in sales. Paladin's profit margin is 3%, and its retention ratio is 55%. How large of a sales increase can the company achieve without having to raise funds externally Can someone answer this question for me pleas? Please helpppppppppppppppppppp! 1. Determine whether the following hydroxide ion concentrations ([OH]) correspond to acidic, basic, or neutral solutions by estimating their corresponding hydronium ion concentrations ([H3O+] using the ion product constant of water (Kw). Kw = [H3O+][OH] = [1107 M][1107 M] = 11014 MHydronium ion concentration [H3O+] Solution condition Greater than 1107 M Acidic Equal to 1107 M Neutral Less than 1107 M Basic Drag the appropriate items to their respective bins.1. [OH] = 61012 M2. [OH] = 9109 M3. [OH] = 81010 M4. [OH] = 71013 M5. [OH] = 2102 M6. [OH] = 9104 M7. [OH] = 5105 M8. [OH] = 1107 MA. AcidicB. NeutralC. Basic2. A solution has [H3O+] = 5.2105M . Use the ion product constant of water Kw=[H3O+][OH]to find the [OH] of the solution.3. A solution has [OH] = 2.7102M . Use the ion product constant of water Kw=[H3O+][OH]to find the [H3O+] of the solution.