Why should investors know the difference between nominal and real interest rates?.

Answers

Answer 1

Why should investors know the difference between nominal and real interest rates is: To be able to to recognize the effects of inflation.

Nominal and real interest rates

It is important or paramount that  investors know the difference between nominal and real interest rates as this will enable them to know the effect of inflation which occur when their is  increase in the price of goods and service.

Nominal interest rates will  help tell investors about the current situation in the market  while Real rates will tell investor  the returns they can gain so as to increase their capital.

Therefore Why should investors know the difference between nominal and real interest rates is: To be able to to recognize the effects of inflation.

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Related Questions

In recording an accrual adjusting entry to account for revenues earned but not yet collected, ______.

Answers

Answer:

An asset is increased.

Explanation:

In recording an accrual adjustment to account for revenues earned but not yet collected: -An asset is increased since cash will be collected at a later date.

It will be difficult to institute fiscal policy in a stabilizing manner because politicians will find

Answers

It will be difficult to institute fiscal policy in a stabilizing manner because politicians will find budget deficit more attractive during recession.

What is budget deficit?

Budget deficit occur when the government spending or expenditure is more than the revenue.

It will be hard to institute fiscal policy based on the fact that  politicians will find budget deficit more attractive during recession in which on the other hand they will be unwilling to run budget surplus when their is  an expansion.

Therefore they will find budget deficit more attractive during recession.

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What is the length of the cash conversion cycle for a firm with $3 million in inventory, $1.5 million in accounts payable, a collection period of 40 days, and an annual cost of goods sold of $18 million

Answers

The length of the cash conversion cycle for a firm with $3 million in inventory is 70.41 days.

How to calculate the days?

Days of inventory outstanding= 365/ Inventory turnover

Formula for calculating inventory turnover:

Inventory Turnover = Cost of Goods Sold/Average Inventory

= $18 million / $3 million

= 6

Days of inventory outstanding= 365/ 6 = 60.83 days

Days of payable outstanding= 365/ Payables turnover

Payables turnover = Cost of Goods Sold/ Average Payables

= $18 million / $1.5

= 12

Days of payable outstanding= 365/ 12

= 30.42 days

Cash conversion cycle= Days of inventory outstanding + Days of sales outstanding – Days of payables outstanding

= 60.83 days + 40 days - 30.42 days

= 70.41 days.

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The five 10-year semi-annual coupon bonds listed below are of comparable risk and have the same call provision: 5 years of call protection (NC-5), after which bonds are callable at 105% of par in the 6th year and declining ratably thereafter (103.75, 102.5, 101.25 and par in years 7, 8, 9, and 10, respectively). Which of these bonds appears to face the highest call risk

Answers

The bond that has the highest call risk based on the groups is A bond priced at 90 with 8 years to maturity.

What is the call risk of a bond?

This is the risk that a person that issues bonds would have to redeem the bond before it gets to its maturity. The bond would be a callable bond.

The holder of the bond is going to get value based on the price of this bond.

Complete question

The five 10-year semi-annual coupon bonds listed below are of comparable risk and have the same call provision: 5 years of call protection (NC-5), after which bonds are callable at 105% of par in the 6th year and declining ratably thereafter (103.75, 102.5, 101.25 and par in years 7, 8, 9, and 10, respectively). Which of these bonds appears to face the highest call risk?

A bond priced at 90 with 2 years to maturity

A bond priced at 90 with 8 years to maturity

A bond priced at 105 with 4 years to maturity

A bond priced at 115 with 2 years to maturity

A bond priced at 120 with 2 years to maturity

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Phil paid $75,000 for his house. It is insured for $65,000. The market value is $85,000. The outstanding mortgage balance is $68,000, and he has to pay annual real estate taxes of $2,000. When Phil lists his house on his balance sheet, he should record: Group of answer choices $75,000 $68,000 $65,000 $70,000 $85,000

Answers

When Phil lists his house on his balance sheet, he should record D. $85,000.

What is the value of an asset on the personal balance sheet?

Since Phil is not a business entity, he should use the market value of the house to record it on the balance sheet.

The balance sheet shows the current financial position (assets and liabilities) at a point.

Data and Calculations:

House price = $75,000

Insurance = $65,000

Market value = $85,000

Outstanding mortgage balance = $68,000

Annual real estate taxes = $2,000

Thus, when Phil lists his house on his balance sheet, he should record D. $85,000.

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What is the most widely consumed meat in the world?.

Answers

Answer:

Pork is the most widely consumed meat in the world.

How does the truth lending act impact/benefit Lenders

Answers

♨ANSWER♥

The Truth in Lending Act (TILA) protects you against inaccurate and unfair credit billing and credit card practices. It requires lenders to provide you with loan cost information so that you can comparison shop for certain types of loans.

...hope this helps...

_♡_mashi_♡_

Josh works for a large, multinational corporation. He has some new ideas for the product his department markets. To share his ideas, he must first share it with his assistant manager, who then meets with the department head. The department head in turn will have to meet with the division chair, who can take it to the marketing committee for a decision. Josh's company, like many organizations, is a

Answers

Josh's company, like many other organization, is a hierarchical organizational structure.

What is a hierarchical organizational structure?

A hierarchical organizational structure is a formal type of structure that is usually followed by the multi-national and large industries.

It is a systematic structure, in which decisions are made by the top management. Then, the decisions being made by the top level will be followed by the other departments.

It is a formal decision making process.

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Quinoa farms just paid a dividend of $2.95 on its stock. the growth rate in dividends is expected to be a constant 3.4 percent per year indefinitely. investors require a return of 15 percent for the first three years, a return of 13 percent for the next three years, and a return of 11 percent thereafter. what is the current share price

Answers

Based on the dividend growth rate and the required return on Quinoa Farms stock over the years, the current share price is $34.93.

What is Quinoa farm's current stock price?

This is the sum of the present values of the dividends using the various required returns.

The dividends for the years are:

Year 1:

= 2.95 x ( 1 + 0.034)

= $3.0503

Year 2:

= 3.0503 x ( 1 + 0.034)

= $3.1540

Year 3:

= 3.154 x 1.034

= $3.2612

Year 4:

= 3.2612 x 1.034

= $3.3721

Year 5:

= 3.3721 x 1.034

= $3.4868

Year 6:

= 3.4868 x 1.034

= $3.6053

Year 7:

= 3.6053 x 1.034

= $3.7279

This allows us to calculate the terminal value at year 6:

= 3.7279 / (11% - 3.4%)

= $49.05

The current price is:

= 3.0503 / 1.15 + 3.1540 / 1.15² + 3.2612 / 1.15³ + 3.3721 / (1.15³ x 1.13) + 3.4868 / (1.15³ x 1.13²) + 3.6053 / (1.15³ x 1.13³) + 49.05 / (1.15³ x 1.13³)

= $34.93

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While creating its afi strategy framework, gordon's consultants decided what markets the firm should compete in. by doing this, what type of strategy did the company devise

Answers

By deciding what markets should the firm compete in, the Gordon's Consultants devised corporate strategy.

What is a corporate strategy?

A strategy, which is a part of functioning of a business organization and involves highly efficient decision-making for the purpose of achieving its organizational goals, is known as a corporate strategy.

Hence, the significance of corporate strategy is aforementioned.

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The ____ is a multiple choice examination that evaluates the skills of the applicants for enlistment in the US military.

Answers

The  Armed Services Vocational Aptitude Battery (ASVAB) is a multiple-choice examination that evaluates the skills of the applicants for enlistment in the US military.

This is further explained below.

What is the Armed Services Vocational Aptitude Battery (ASVAB)?

Generally, The Armed Services Vocational Aptitude Battery (ASVAB) is a multiple-choice test that assesses applicants' skills for enrollment in the United States military.

In conclusion, The United States Military Entrance Processing Command uses the Armed Services Vocational Aptitude Battery (ASVAB), a multiple-choice exam, to screen applicants for possible service in the armed forces.

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The effects of legislation on human resource professionals is important because: Multiple choice question. it seldom changes and is consistent in all states legislation affects only very specific functions in human resource management legislation affects all areas of human resource management court cases rarely change the effect of the laws and how they are interpreted in the workplace

Answers

The effects of legislative laws on human resource professionals are important as it affects all the areas covered under human resource management.

What is a human resource?

Human resource is referring to the employees or workforce working or being employed in the organization by the HRs.

The legislation passed concerning HRM covers all the areas in which they are working. The areas can be the hiring of employees, monitoring their performance, compensation and rewards tracking, training regarding the projects of the company, induction of the company, etc.

Therefore, the laws relating to HRM would help HR managers in performing all the tasks in an efficient manner.

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pls helppp...

19. A business provided the following information [Refer to image]. What was the total of the current liabilities?

a) 13 200
b) 15 400
c) 31 200
d) 32 700 ​

Answers

Answer:

32 700

Explanation:

that is the answer 32 700

Angela's bank gave her a 2-year add-on interest loan for $6,440 to pay for new equipment for her antiques restoration business. the annual interest rate is 7.62%. how much interest will she pay? what are her monthly payments?

Answers

but i dont no the answer i think it is 1000 i dont no

The time frame for loan repayment for the borrower. Interest Rate: The rate of growth in the amount owing, typically represented as an annual percentage rate (APR).

What is loan ?

Loan Payments: The sum of money required to be paid each week or month in order to fulfill the loan's conditions.

Interest rates have a big impact on loans and how much the borrower will ultimately pay. Larger interest rate loans have longer payback periods or higher monthly payments than lower interest rate loans.

For instance, if a borrower takes out a $5,000 installment or term loan with a five-year term and a 4.5% interest rate, their monthly payment for the next five years will be $93.22.

Calculation of Interest

Given in Question

Loan amount = $ 6,440

Interest Rate = 7.62 %

Time = 2 years paid monthly

[tex]6440*7.2%/12= 38.64 (monthly Interest)\\6440/24 = $ 268.34\\Total payment Monthly = 306.97\\[/tex]

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You own a small manufacturing business that produces widgets. You have spent $400,000 acquiring the fixed assets you need to produce widgets. Each widget costs you $3 to make and they sell for $25 each, so your variable cost is 12% of the overall revenue. At your current level of operating leverage, how many widgets must you sell to break even

Answers

At the current level of operating leverage, the small manufacturing business needs to sell 18,182 units of widgets to break even.

What is the break-even point?

The break-even point is the level of production and sales required so that the entity does not incur any losses or earn any profits.

At the break-even point, the total costs (fixed and variable) equal the sales revenue.

Data and Calculations:

Fixed assets = $400,000

Production cost of each widget = $3

Selling price per unit = $25

Variable cost per unit = $3 ($25 x 12%)

Contribution margin per unit = $22 ($25 - $3)

Break-even point in units = Fixed Costs/Contribution margin per unit

= 18,182 units ($400,000/$22)

Thus, at the current level of operating leverage, the small manufacturing business needs to sell 18,182 units of widgets to break even.

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Which of the following aggregate planning strategies is known to lower employee morale? Group of answer choices back ordering during high demand periods counterseasonal product and service mixing changing inventory levels yield management varying work force size by hiring or layoffs

Answers

The planning strategies that  is known to lower employee morale is varying work force size by hiring or layoffs.

What is Employee morale?

Employee morale serves as the  attitude as well as satisfaction that an employee shows in an organization,  and this can be seen  during their association with other employees as well as customers in that organization or a business.

Therefore , varying work force size by hiring or layoffs will reduce

Employee morale.

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How should disability payments, which are non-taxable, be analyzed in order to fairly calculate the customer’s ability to pay?.

Answers

The person's ability to pay is determined by your T-2 calendar year income is analyzed in order to calculate customer’s ability to pay.

What is disability payments?

Disability payment are the payments given by the government of the nation for the people who are not able to work because of the major issue in their body. This payment has some criteria and based on that criteria a person is liable for liability payments benefits.

Thus, The person's ability to pay is determined by your T-2 calendar year

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Statistical studies in which researchers control variables of interest are:.

Answers

Statistical studies in which researchers control variables of interest are called Experimental Studies.

What are the types of statistical Studies?

In experimental studies and key output is data gotten from the experiment, this data can be used in several ways to interpret results.

There are basically three types of statistical studies and they are:

Observational studyExperimental studySurveys

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Tyler, a self-employed taxpayer, travels from Denver to Miami primarily on business. He spends five days conducting business and two days sightseeing. His expenses are $400 (airfare), $150 per day (meals at local restaurants), and $300 per night (lodging). If required, round your answers to the nearest dollar. What are Tyler's deductible expenses in the below year: 2023 $fill in the blank 1 2022 $fill in the blank 2

Answers

The deductible expenses for Tyler in these years are:

2023 = $22752022 = $2650

How to solve for the deductible expenses

Air fare = 400 dollars

Lodging = 300 x 5

meals = 150 x 5 x 50%

Total in 2023 = 400 + 1500 + 375

= $2275

The deductible for 2022

400 + 5x150 + 5x300

= $2650

Hence the total deductible in 2023 =  $2275

and in 2022 = $2650

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Social media sites can provide a firm with insights into a consumer's opinions about the firm and Blank______. Multiple choice question. the consumer's opinions about the firm's competition the opinions about the firm from the consumer's neighbors the consumer's neighbors' opinions about the firm the opinions about the firm's competition from the consumer's relatives

Answers

Social media sites can provide a firm with insights into a consumer's opinions about the firm and the opinions about the firm from the consumer's neighbors.

How social media helps the firm to get the idea of trends?

Social media helps the company to get the trend and idea about the latest things going on in the world or the latest challenges going on the world. Everything which is happening on the country was on social media platform.

Thus, option B is correct.

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A _____ allows those within the various organizational departments and positions to know exactly what are an individual's responsibilities..

Answers

A Job description allows those within the various organizational departments and positions to know exactly what are an individual's responsibilities. This is further explained below.

What is Job description?

Generally, Job description is simply defined as a written statement of a worker's duties.

In conclusion, An individual's duties and obligations are laid out in a job description, which helps people in different organizational divisions and roles.

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Victor works for a telemarketing company that is on a very tight budget. He has been tasked with finding a method for the company's employees to share, organize, and update their telemarketing records so other employees can follow up. Employee shifts are staggered. Many employees are never in the office at the same time and some work from home. What telecommunications technology can Victor's company use

Answers

The telecommunications technology that Victor's company can use is a wiki.

What is telecommunication?

It should be noted that telecommunication simply means the communication over distance by cable, telegraph, or telephone.

In this case, the telecommunications technology that Victor's company can use is a wiki. This important for the communication.

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Assume a bond has a $1,000 par value, a coupon rate of 6 percent, annual interest payments, and 7 years to maturity. If the yield on similar bonds is 8 percent, what is the current market value of this bond

Answers

Based on the value of the bond at par, the coupon rate, and the yield to maturity, the current market value of the bond is $895.87.

What is the current bond value?

This can be found as:

= Present value of bond coupon payments + Present value of par value

Coupon payments:

= 6% x 1,000

= $60

As this payment is constant, it can be treated as an annuity.

Current market value is:

= (Coupon payment x Present value of annuity interest factor, 8%, 7 periods) + ( 1,000 / (( 1 + rate) ^ number of years)

= (60 x 5.2064) + ( 1,000 / 1.08⁷)

= $895.87

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XYZ Corp. issued 13 years ago at a coupon rate of 8 percent. The bonds make semiannual payments. If these bonds currently sell for 115 percent of par value, what is the YTM

Answers

Answer:

what is geography

Explanation:

what is geography?

A company's cost of capital is mainly determined by ______________. *

Answers

The cost of capital of a corporation is majorly dependent upon the capital structure.

What is capital structure?

The mix of various forms of finances used by a business to meet its capital requirements is known as the capital structure of such business. It may consist of equity, accumulated profits, and debts.

Hence, the capital structure determines the cost of capital of a company.

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Fractional reserve banking is useful for banks because it:

O A. allows the value of loans to exceed the value of cash reserves.
OB. combines the services of both commercial and retail banks.
OC. divides large accounts into smaller ones that are easier to
manage.
OD. pressures customers to accept higher interest rates on loans.

Answers

I think the Answer is A

According to marketers, what happens when a frozen yogurt customer, radley, goes on social media promoting his preference about a yogurt shop’s service and flavor offerings?.

Answers

What happens when a frozen yogurt customer, radley, goes on social media promoting his preference is: he potentially generates new business.

Who is a marketer?

A marketer is someone to help to market a company product by creating product or brand awareness so as to attract potential customers.

If he is promoting or creating awareness about his preference, this means that he had  created  a new business which he want people to know about.

Therefore he potentially generates new business.

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Sharing information with others is an effective reason to schedule a meeting. Group of answer choices True False

Answers

Answer:

Your answer would be True.

Explanation:

You sign a contract to purchase a machine that will allow you to travel back in time and meet abraham lincoln. assuming that time machines don't actually exist (for now), what type of contract is this

Answers

The correct option is C). Void contract. It is void type of contract if you sign a contract to purchase a machine that will allow you to travel back in time and meet Abraham Lincoln.

What is void contract?

Void contract is a formal contract between two parties, which is not authorized by the law and enforceable from the moment it was created.

A void contract is little differ from the valid contract. Void contract is not an actual contract, despite it is unenforceable.

Both void and voidable contract are null, but a void contract cannot be officially valid.

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A mixed-market economy is best defined as an economy

with some government intervention.
without government intervention.
with some externalities.
without corporate compliance.

Answers

Answer:

A. with some government intervention

Explanation:

A mixed economic system is a system that combines aspects of both capitalism and socialism. A mixed economic system protects private property and allows a level of economic freedom in the use of capital, but also allows for governments to interfere in economic activities in order to achieve social aims.

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