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2 years ago

The primary purpose of the legal reserve requirement is to:

Business

1 answer:

Marta_Voda [28]2 years ago

4 0

Answer: The correct answer is choice C.

Explanation: The primary purpose of the legal reserve requirement is to provide a means by which monetary authorities can influence the lending ability of commercial banks. These policies are the way in which the Federal Reserve can control the money supply.

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A coupon bond that pays interest semiannually has a par value of $1,000, matures in 8 years, and has a yield to maturity of 6%.

vitfil [10]

Answer:

b. 1,062.81

Explanation:

the key to answer this question is to remember that valuation of a bond depends basically of calculating the present value of a series of cash flows, so let´s think about a bond as if you were a lender so you will get interest by the money you lend (coupon) and at the end of n years you will get back the money you lend at the beginnin (principal), so applying math we have the bond value given by:

$price=\frac{principal*coupon}{(1+i)^{1} }+ \frac{principal*coupon}{(1+i)^{2} } \frac{principal*coupon}{(1+i)^{3} }+...+\frac{principal+principal*coupon}{(1+i)^{n} }$

where: principal as said before is the value lended, coupon is the rate of interest paid, i is the interest rate and n is the number of periods

so applying to this particular exercise, as it is not said we will assume that 6% and 7% are interest rate convertible seminually, so the price of the bond will be:

$price=\frac{1,000*\frac{0.07}{2} }{(1+\frac{0.06}{2}) ^{1} } +\frac{1,000*\frac{0.07}{2} }{(1+\frac{0.06}{2}) ^{2} }+\frac{1,000*\frac{0.07}{2} }{(1+\frac{0.06}{2}) ^{3} }+...+\frac{1,000*\frac{0.07}{2} }{(1+\frac{0.06}{2}) ^{15} }+\frac{1,000+1,000*\frac{0.07}{2} }{(1+\frac{0.06}{2}) ^{16} }$

price=1,062.81

take into account that here we are asked about semianually payments, so in 8 years there are 16 semesters.

6 0

3 years ago

Scenario: Money Creation The reserve requirement is 20%. Leroy receives $1,000 as a graduation present and deposits the money in

disa [49]

Your answer to this question is increased by $1000

8 0

2 years ago

Pow Corp. accidentally overstated its 2018 ending inventory by $750. Assume that ending 2019 inventory is accurately counted. Th

sergeinik [125]

Answer:

b. 2018 net income is overstated by $750

Explanation:

As the ending inventory is overstated the COGS will be understated thus, the income was overstate as well. Because the expenses reduced from the sales revenues were lower than correct.

Also we can deduct the same logic considering the accounting equation

Assets = liab + equity

if asssets are 750 higher than it should, then Equiy is higher as well

+750 = +750

Equity is affected for the net income and dividends. Thus, we can also conclude the net income is overstated by 750

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2 years ago

A positive shift in attitude occurs as a result of ___________.

brilliants [131]

Hardwork is right answer

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2 years ago

When paid interest is started as a dollar amount is called

Igoryamba

The answer is Finance

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2 years ago

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