Answer and Explanation:
Given that Bond A pays $4,000 in 14 years and Bond B pays $4,000 in 28 years, and that the interest rate is 5 percent, we see that Using the rule of 70, the value of Bond A is 70/5 = doubled after 14 years. Now if its value is 4000 in 14 years, its current value must be halved. Hence the value is 2000.
Sinilarly the value of Bond B is approximately one fourth now because it pays 4000 in 28 years. Hence its value is 4000/4 = 1000.
Now suppose the interest rate increases to 10 percent. Hence the doubling time is 70/10 = 7 years
Using the rule of 70, the value of Bond A is now approximately 1,000 and the value of Bond B is 250
Comparing each bond’s value at 5 percent versus 10 percent, Bond A’s value decreases by a smaller percentage than Bond B’s value.
The value of a bond falls when the interest rate increases, and bonds with a longer time to maturity are more sensitive to changes in the interest rate.
Answer:
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Explanation:
Answer and Explanation:
The preparation of flexible budget report is shown below:-
Xion CO.
Flexible budget report
Flexible budget Actual results Variances Favorable/
Unfavorable
Sales $864,000 $885,000 $21,000 Favorable
(10,800 × $80)
(-) Variable
cost $378,000 $351,000 $27,000 Favorable
(10,800 × $35)
Contribution $486,000 $534,000 $48,000 Favorable
(-) Fixed cost $270,000 $285,000 $15,000 Unfavorable
Net income $216,000 $249,000 $33,000 Favorable
Answer:
c. 2.35%
Explanation:
10 year T bond Yield = 5.05 % (let it be rT10)
10 year TIPS yield = 1.8 % ( let it be r* )
MRP = 0.9%
Expected Inflation = rT10 - r* - MRP
= 5.05 % - 1.8 % - 0.9%
= 2.35 %
Therefore, The expected rate of inflation over the next 10 years is 2,35%.
The question is incomplete, it lacks options.
A) extranet
B) corporate portal
C) intranet
D) executive information system
Answer:
Extranet.
Explanation:
An extranet can be defined as a private network that is used for information sharing. An extranet is a private network which is created by a company to enable customers and suppliers to get specific information about the company but preventing them access to other private and sensitive information.
Extranet makes it very easy to share information with potential customers and various shareholders. Extranet also improves customer service by providing them with various information to solve their questions.
