Answer:
18.5 months approximately
Explanation:
initial investment x (1 + appreciation rate)ⁿ = initial investment + $100,000 + ($500 x n)
$250,000 x (1 + 2%)ⁿ = $350,000 + $500n
1.02ⁿ = $350,000/$250,000 + $500n/$250,000
1.02ⁿ = 1.4 + 0.002n
I tried to solve it by trial and error:
50 months:
2.69 ≠ 1.5
40 months:
2.21 ≠ 1.48
30 months:
1.81 ≠ 1.46
20 months:
1.49 ≈ 1.44 ⇒ getting closer
18 months:
1.43 ≈ 1.44 ⇒ almost
18.5 months:
1.44 = 1.44 ✓
Vernon Boat Company makes inexpensive aluminum fishing boats. Production is seasonal, with considerable activity occurring in the spring and summer. Sales and production tend to decline in the fall and winter months. During year 2, the high point in activity occurred in June when it produced 209 boats at a total cost of $154,800. The low point in production occurred in January when it produced 31 boats at a total cost of $48,000. Required Use the high-low method to estimate the amount of fixed cost incurred each month by Vernon Boat Company. Determine the total estimated cost if 110 boats are made.
Answer:
Total cost= $95,400
Explanation:
First, we need to calculate the unitary and fixed costs using the high-low method:
Variable cost per unit= (Highest activity cost - Lowest activity cost)/ (Highest activity units - Lowest activity units)
Variable cost per unit= (154,800 - 48,000) / (209 - 31)
Variable cost per unit= $600
Fixed costs= Highest activity cost - (Variable cost per unit * HAU)
Fixed costs= 154,800 - (600*209)
Fixed costs= $29,400
Fixed costs= LAC - (Variable cost per unit* LAU)
Fixed costs= 48,000 - (600*31)
Fixed costs= $29,400
Now, the total cost for 110 boats:
Total cost= 29,400 + 110*600
Total cost= $95,400
What is the folder in which the file named script is contained?
Answer:
The folder name is "script "
When dragons on planet Pern lay eggs, the eggs are either green or yellow. The biologists have observed over the years that 26% of the eggs are yellow, and the rest green. Next spring the lead scientist has permission to randomly select 67 of the dragon eggs to incubate. Consider all the possible samples of 67 dragon eggs.
1. What is the mean number of yellow eggs in samples of 67 eggs? (that is the same as asking for the expected value of the number of yellow eggs)
(Give answer correct to at least one decimal place.)
mean =
2. What is the standard deviation in the number of yellow eggs in samples of size 67?
(Give answer correct to at least one decimal place.)
standard deviation =
3. What is the variance in the number of yellow eggs in samples of size 67?
(Remember to calculate the answer using at least 5 decimal places, then give answer correct to at least one decimal place.)
Answer:
μ= 17.42
var= 12.891= 12.9
σ = 3.59
Explanation:
As the number of trials are fixed i.e 67 and the success is also fixed i.e 26% or 0.26 this is treated as a binomial experiment.
The mean of the binomial experiment is calculated as
μ= np = 67*0.26= 17.42
This is the same as the expected value of number of yellow eggs.
E(y)= np=μ= 67*0.26= 17.42
The variance of the binomial experiment is calculated as
var= npq = 67*0.26(1-0.26)= 67*0.26(0.74)= 12.8908= 12.891
The standard deviation of the binomial experiment is calculated as
σ =√npq= √12.8908= 3.590376 = 3.59038= 3.5904 = 3.590= 3.59
Which of the following costs is most likely NOT included in a bill from the university for a college student living on campus?
Select the best answer from the choices provided.
OA. tuition
OB.
cell phone
Ос.
fees
OD. housing
Answer:
B. cell phone
Explanation:
Out of all the following costs, the most likely not to be included in a bill from the university for a college student living on campus is "Cell Phone."
This is because except a student is on full scholarship, Tuition is a must cost to be included in the bill.
Also, student fees that cover extra costs like insurance, and health care are usually included in student bills.
Similarly, the housing cost covers a hostel or off-campus accommodation for students. Hence it is also included in the student bill.
Hence, the correct answer is the cost of a "Cell phone." Which doesn't concern the school whether a student has or not.
During its first year of operations, Mack's Plumbing Supply Co. had sales of $550,000, wrote off $8,800 of accounts as uncollectible using the direct write-off method, and reported net income of $60,500. Determine what the net income would have been if the allowance method had been used, and the company estimated that 2.5% of sales would be uncollectible.
Answer:
$60,500
Explanation:
With regards to the above, the write off does not affect the realizable value of accounts receivables. Also, the total asset or net income is not affected by the write off or specific account. Instead, both assets and net income are affected in the period when bad debt expense is predicted and then recorded with an adjusting entry.
Accounts receivables
$550,000
Less:
Allowance for doubtful account
($550,00 × 2.5%)
($13,750)
Estimated realizable accounts receivables
$536,250
If the amount of bad debt decreases or increases as given below, then the income is also increased or decreased by the amount given.
Bad debts = $13,750
Uncollectible previously written off = $8,800
Difference
$4,950
Net income
$60,500
Less:
Difference
($4,950)
Reported income
$55,550
Cynthia is ready to apply to a four-year private college. Evaluate her eligibility for financial ald.
Select the best answer from the choices provided.
OA. She will not be eligible to receive federal loans.
OB. She will be eligible to walve any interest on private loans.
Ос. .
She will be eligible to receive grants.
OD She will not be eligible to receive scholarships.
Answer:
C.
Explanation
A - Private schools recieve federal funds and so can their students.
B - Some private loans can waive interest, but not all.
D - any student can receive scholarships, if they qualify or if the are awarded the scholarship after applying.
Good luck in your studies.
The risk-free rate of return is 6 percent, and the expected return on the market is 14.7 percent. Stock A has a beta coefficient of 1.6, an earnings and dividend growth rate of 6 percent, and a current dividend of $1.90 a share. Do not round intermediate calculations. Round your answers to the nearest cent. What should be the market price of the stock
Answer:
P0 = $14.4683 rounded off to $14.47
Explanation:
To calculate the market price of the stock today, we will use the constant growth model of DDM. The constant growth model calculates the values of the stock today based on the present value of the expected future dividends from the stock. The formula for price today under this model is,
P0 = D0 * (1+g) / (r - g)
Where,
D0 is the dividend todayg is the constant growth rater is the required rate of return on the stockWe first need to calculate r using the CAPM equation. The equation is,
r = rRF + Beta * (rM - rRF)
Where,
rRF is the risk free raterM is the return on marketr = 0.06 + 1.6 * (0.147 - 0.06)
r = 0.1992 or 19.92%
Using the price formula for DDM above, we can calculate the price today to be,
P0 = 1.9 * (1+0.06) / (0.1992 - 0.06)
P0 = $14.4683 rounded off to $14.47
A group of users can perform certain operations on a shared workbook. Which option helps them to update and track changes in the shared workbook?
The
option allows all group members to update information and track changes in the workbook.
Answer: Edit option allows everyone in a group to edit the contents work
Explanation:
Hope it helps
distinguish between elasticity and slope
Answer:
Elasticity is the ratio of the percentage changes. The slope of a demand curve, for example, is the ratio of the change in price to the change in quantity between two points on the curve.
Hope it helps!!
Delisa Corporation has two divisions: Division L and Division Q. Data from the most recent month appear below: Total Company Division L Division Q Sales $596,000 $170,000 $426,000 Variable expenses 338,000 103,700 234,300 Contribution margin 258,000 66,300 191,700 Traceable fixed expenses 116,060 39,200 76,860 Segment margin 141,940 $ 27,100 $ 114,840 Common fixed expenses 43,950 Net operating income $ 97,990 The break-even in sales dollars for Division Q is closest to:
Answer:
$100,512
Explanation:
Break even point is the level at which a Company makes neither a profit nor a loss.
Break Even (Sales Dollars) = Fixed Costs ÷ Contribution margin
therefore,
Break Even (Sales Dollars) = $39,200÷0.39
= $100,512
The break-even in sales dollars for Division Q is closest to $100,512
CalMark is a privately held company, so there is no information about beta available. However, a company in the same business with a debt to equity ratio the same as that of CalMark is publicly traded and has a beta which is two times that of the market. If the risk free rate is 4%, and the market risk premium is 5%, what is the estimated cost of existing equity for CalMark
Answer:
r - Calmark = 14%
Explanation:
Based on the comparative company analysis and using the CAPM we can calculate the required rate of return for CalMark. The comparative company analysis means to use the companies similar to the subject company to assume various ratios and factor about the subject company.
The formula to calculate the cost of equity which is also known as the required rate of return (r) is,
r = rRF + Beta * rpM
Where,
rRF is the risk free raterpM is the market risk premiumThe beta for market is always equal to 1. So a beta twice of the market will be 2.
r - Calmark = 4% + 2 * 5%
r - Calmark = 14%
George is an entrepreneur who owns a large office that has a few meeting rooms. Almost every day, he sees that there are conflicts between employees over the use of the meeting rooms. As a solution, George posts a schedule for the meeting rooms so that his employees can reserve the rooms going forward. Which skill has George demonstrated in the scenario? A. time management skills B. resource management skills C. task management skills D. speaking skills
Answer:
Explanation:
B : resource management skills
just trust
Bonds issued by XYZ have a par value of $1000, were priced at $1,220.00 six months ago, and are priced at $1,140.00 today. The bonds pay semi-annual coupons and just made a coupon payment. If the bonds had a percentage return over the past 6 months (from 6 months ago to today) of -2.10%, then what is the current yield of the bonds today
Answer:
9.54%
Explanation:
-0.021 = ($1,140 + D - $1,220) / $1,220
-$25.62 = -$80 + D
$54.38 = Dividend (semiannual)
current yield = annual dividends / current price
annual dividends = $54.38 x 2 = $108.76
current price = $1,140
current yield = $108.76 / $1,140 = 0.0954 = 9.54%
During its first year of operations, Dudu Company paid $50,000 for direct materials and $36,000 in wages for production workers. Lease payments and utilities on the production facilities amounted to $14,000. General, selling, and administrative expenses were $16,000. The company produced 5,000 units and sold 4,000 units for $30.00 a unit. The average product cost per unit is which of the following amounts?
a. $16.00
b. $18.40
c. $25.00
d. $20.00
Answer:
Average production cost= $20
Explanation:
The product cost is the sum of direct material, direct labor, and allocated overhead. First, we need to calculate the total production costs:
Total production costs= 50,000 + 36,000 + 14,000= $100,000
Now, the average production cost:
Average production cost= total costs / units produced
Average production cost= 100,000 / 5,000
Average production cost= $20
Which of the following is not an important factor to assess when identifying appropriate precedent transactions?
Answer:
how to answer that ?????
The factor that is not important for the identification of precedent transactions is Accretive/dilutive effect of the transaction on the acquirer. Thus, option 2nd is correct.
What is precedent transaction?Precedent transaction refers to the valuation process of the price being paid for the similar companies in the past is taken into account as a gauge of a valuation of company's value.
An estimation of a share's value in the event of an acquisition is produced through precedent transaction analysis. It is the limitation of the precedent transaction that past cost may not reflect the prevailing conditions of the market.
Therefore, it can be concluded that The accretive or dilutive effect of the acquisition on the acquirer is a criterion that is not crucial for identifying prior transactions. Hence, option 2nd is correct.
Learn more about Precedent transaction here:
https://brainly.com/question/20983891
#SPJ5
Your question is incomplete, but most probably the full question was...
Which of the following is not an important factor to assess when identifying appropriate precedent transactions?
1) Transaction rationale
2) Accretive/dilutive effect of the transaction on the acquirer
3) Transaction size
4) Industry & financial characteristics
What is the most money that an investor could lose if they buy 40 shares of electriccarco for $25/share
Answer:
$300
Explanation:
A borrower is interested in comparing the monthly payments on two otherwise equivalent 30 year FRMs. Both loans are for $100,000 and have a 7% interest rate. Loan 1 is fully amortizing, where as Loan 2 has negative amortization with a $120,000 balloon payment due at the end of the life of the loan. How much higher is the monthly payment on loan 1 versus loan 2
Answer:
The monthly payment in Loan 1 is higher than in loan 2 by:
(665.30 - 566.94) = $98.36
Explanation:
Solution:
Comparison of Loan 1 and Loan 2 in terms of monthly payments.
For the first loan, we have to calculate equal monthly payments with the following details:
Principal = $ 100,000,
Monthly Interest rate = 7/12 = 0.58% ,
Term = 360 months
Use the PV = C (1 - (1+r)-n ) / r ,
where PV = Principal, r = monthly rate, n = 360 and
find C (EMI) = $665.30
NOTE: (Excel function is used: PMT(rate, year, PV) formula for convenience)
For Loan 2, we have to understand a few things.
The original loan principal is $ 100,000,
but you are allowed to do a balloon payment of $ 120000 at the end of 30 years.
The present value of the Balloon payment can be deducted from the principal to find out the monthly cash payments to be done.
The monthly payments will of course be lower since a lump sum balloon payment is done at the end.
The calculation is similar to the above. In this scenario, the Monthly payment comes out to be $ 566.94
Hence,
The monthly payment in Loan 1 is higher than in loan 2 by:
(665.30 - 566.94) = $98.36
The appropriate section in the statement of cash flows for reporting the issuance of common stock for cash is: Multiple Choice Operating activities. Financing activities. Investing activities. Schedule of noncash investing or financing activity. This is not reported on the statement of cash flows.
Answer:
Financing activities.
Explanation:
In the financing activities of the cash flow statement the stockholder equity section should be considered i.e. if there is an issuance of the common stock or preferred stock or both so the same would be represented as cash inflow but if there is a dividend so it would be represent as a cash outflow
So as per the given situation it is a part of the financing activities
17) Two commonly used techniques to aid managers with important decisions for setting a direction and allocating resources include ________ and ________ analysis strategies. A) micromarketing; macromarketing B) business portfolio; diversification C) investment; divestment D) dashboards; metrics E) subjective; objective Group of answer choices a b c d e
Answer:
Option b: business portfolio; diversification
Explanation:
A business is commonly defined as the clear, broad, underlying industry or market segment or sector of an organization's offering.
A business portfolio analysis is simply a technique that managers use to grade performance measures and growth targets to analyze their firms' strategic business units (SBUs) as if they are collection of different investments.
Diversification analysis is also a technique use in business to helps a firm or organizations to search for growth opportunities from among current and new markets as well as current and new products.
Aggregating potential car buyers into groups that have common needs and will respond in the same way to a marketing campaign is a process known as Multiple Choice market positioning. market segmentation. market cataloging. market differentiation. product differentiation.
Answer:
Aggregating potential car buyers into groups that have common needs and will respond in the same way to a marketing campaign is a process known as:
Market segmentation.
Explanation:
Market segmentation is a marketing effort by a business entity to classify its customers into groups according to similar characteristics and based on Demographic, Psychographic, Geographic, and Behavioral segments. Market segmentation helps the entity to identify market opportunities, design products, time marketing efforts, select appropriate media, and efficiently allocate resources to achieve its marketing goals.
Identify which situation will lead to a fall in the net exports.
a.
More government spending than taxation
b.
More taxation than government spending
c.
More exports than imports
d.
More imports than exports
Help Fast please
Answer:
Use the drop-down menus to answer the questions.
In this circular flow mode, what does the letter A present?
✔ financial sector
What does the letter B represent?
✔ government sector
What does the letter C represent?
✔ foreign sector
What does the letter D represent?
✔ leakages
Explanation:
got it right on edge
[Hair Stylist Woes] Ryan, a college student, went to see his hair stylist, Melissa. Ryan, who had black, curly hair, requested straight, blond hair. Melissa told him that she could make those changes, but that there would be significant upkeep involved. Melissa made the changes, but Ryan did not do the upkeep required. Ryan proceeded to falsely claim that Melissa did not do what Ryan asked her to do that Melissa lied to him, and that Melissa was professionally incompetent. Ryan made the statements about Melissa to friends of his. He also wrote a letter to his college newspaper saying that Melissa's shop should be avoided at all costs because Melissa was incompetent In fact, Melissa was a good hair stylist and enjoyed a good reputation up until the time that Ryan started his criticism. Melissa threatened to sue Ryan for defamation, but Ryan told Melissa that she could not prevail because she could not prove loss of income. Melissa had to admit that while her reputation had been damaged somewhat and she felt embarrassed and humiliated, the damage was primarily her appointment times were booked for weeks ahead. Statements made by Ryan to his friends that were defamatory of Melissa are what type of defamation? a. Libel but not slander. b. No tort was committed because the statements were made only to friends of Ryan, not to business acquaintances of Candy. c. No tort was committed because the falsehood involved matters of appearance not business related matters. Slander but not libel. d. Both libel and slander.
Answer:
The type of defamation statements made by Ryan against Melissa are:
d. Both libel and slander.
Explanation:
Ryan made a libelous statement against Melissa by writing to his college newspaper, advising potential clients to avoid Melissa's shop because of her alleged incompetence. Ryan also made slanderous statements against Melissa to his friends. The defamation of character and reputation was both libelous and slanderous.
In general, improvements in technology that is used to produce a good will result in ___________.
a decrease in supply
a shortage of the good
an increase in supply
higher operating costs
Answer:
first one
Explanation:
because I am a teacher and I know this
Assume Simple Co. had credit sales of $256,000 and cost of goods sold of $156,000 for the period. Simple uses the percentage of credit sales method and estimates that 1 percent of credit sales would result in uncollectible accounts. Before the end-of-period adjustment is made, the Allowance for Doubtful Accounts has a credit balance of $310. What amount of Bad Debt Expense would the company record as an end-of-period adjustment
Answer: $2560
Explanation:
A bad debt expense simply refers to a scenario whereby a receivable isn't collectible due to the fact that a customer isn't able to pay their outstanding debt.
Based on the information given in the question, the amount of bad debt expense that would be recorded by the company as an end-of-period adjustment will be:
= Credit sales × Percentage of uncollectible accounts
= $256000 × 1%
= $256000 × 0.01
= $2560
Solve the following problem to find the maximum profit by creating a spreadsheet.
a. A company is making Boats and Motors. The boats sell for $22,000 and the motors sell for $15,000.
b. There are 3 factories available to make the products.
c. Factory 1 requires 9 hours to make a boat and is not capable of making motors. It has 84 hours available.
d. Factory 2 does not have the capability to make boats and requires 3 hours to make a motor. It has 40 hours available.
e. Factory 3 requires 16 hours to make a boat and 5 hours to make a motor. It has 120 hours available.
Answer:
Maximum profit = $765,333.33
Explanation:
Note: See the attached excel file for the calculation of the maximum profit (in bold red color).
In the calculation, it is assumed that selling price per unit is the same thing as the profit per unit since we are not given the cost per unit.
Therefore, from the attached excel file, we have:
Maximum profit = $765,333.33
You are thinking about the things that can go wrong on your trip home over the Thanksgiving break. You have booked a flight with US-Scareways. You know that in 35 percent of the cases the company has canceled the flight you were on. Should such a thing occur, there would be no other air travel option home for you. As a backup, your friend Walter has offered you a ride back. However, you know that Walter only has a seat in his car for you with 70 percent probability.
What is the probability of you making it home for the holidays?
Answer: 89.5% or 0.895
Explanation:
Probability of you making it home if the flight is canceled:
= Probability that flight is canceled * probability that Walter has a seat
= 35% * 70%
= 24.5%
Probability of you making it home by flight:
= 100% - 35%
= 65%
Probability of you making it home for the holidays:
= Prob. if flight is canceled + Prob. by flight
= 24.5% + 65%
= 89.5%
Under an installment contract, a buyer can:
a. Reject an installment if the nonconformity substantially impairs the value of the installment without giving the seller an opportunity to cure
b. Hold the seller in breach of the entire installment contract when a nonconforming installment substantially impairs the value of that installment alone.
c. Reject an installment no matter how minor the nonconformance is.
d. None of these answers.
Answer:
b. Hold the seller in breach of the entire installment contract when a nonconforming installment substantially impairs the value of that installment alone.
Explanation:
In installment contract, the seller and the buyer agrees on the ways through which the buyer will pay for the goods which he or she purchases installmentally rather than a one off payment. In a situation where the agreement has been reached, it expected that the buyer and the seller to conform to the said agreement. However,the seller is hold in breach of the entire installment contract if there is impairment of the value of the goods substanstially.
On October 1, 2018, Jarvis Co. sold inventory to a customer in a foreign country, denominated in 100,000 local currency units (LCU).Collection is expected in four months. On October 1, 2018, a forward exchange contract was acquired whereby Jarvis Co. was to pay 100,000 LCU in four months (on February 1, 2019) and receive $78,000 in U.S. dollars. The spot and forward rates for the LCU were as follows:
Rate DescriptionExchange Rate .83-1 LCU 5.85 1 LCU Spot rate: Spot rate: 1-Month Forward Rate $.be = 1 LCU Spot rate: October 1, 2018 December 31, 2018 February 1, 2019 .86 1 LCU The,company's borrowing rate is 12%. The present value factor for one month is .9901. Any discount or premium on the contract is amortized using the straight-line method , Assuming this is a cash flow hedge:
prepare journal entries for this sales transaction and forward contract.
Answer:
10/1/2018
Dr Accounts receivable $83,000
Cr Sales $83,000
12/31/2018
Dr Accounts receivable $2,000
Cr Foreign exchange gain $2,000
12/31/2018
Dr Loss on forward contract $1,980
Cr Forward contract $1,980
2/1/2018
Accounts receivable $1000
Cr Foreign exchange gain $1000
2/1/2018
Dr Loss on forward contract $6,020
Cr Forward contract $6,020
2/1/2018
Dr Foreign currency
$86,000
Accounts receivable $86,000
2/1/2018
Dr Cash $78,000
Dr Forward contract $8,000
Cr Foreign currency $86,000
Explanation:
Preparation of the journal entries for the sales transaction and forward contract.
10/1/2018
Dr Accounts receivable (100000*0.83) $83,000
Cr Sales $83,000
12/31/2018
Dr Accounts receivable $2,000
[100,000*(0.85-0.83)]
Cr Foreign exchange gain $2,000
12/31/2018
Dr Loss on forward contract $1,980
[((0.80-0.78)*100000)*2000*0.9901]
Cr Forward contract $1,980
2/1/2018
Accounts receivable $1000
[100000*(0.86-0.85)]
Cr Foreign exchange gain $1000
2/1/2018
Dr Loss on forward contract $6,020
(78000/100000 = 0.78)
[ ((0.78-0.86)*100000) = 8000-1980=6020]
Cr Forward contract $6,020
2/1/2018
Dr Foreign currency (100000*0.86)
$86,000
Accounts receivable $86,000
2/1/2018
Dr Cash $78,000
Dr Forward contract $8,000
($86,000-$78,000)
Cr Foreign currency (100000*0.86) $86,000
Since a cell phone is a private good, if Neha chooses to spend $300 on a cell phone, Neha would get $300 of benefit from the cell phone and Teresa wouldn't receive any benefit from Neha's choice. If Neha still spends $300 on a cell phone and Teresa chooses to contribute $300 to the public park, Neha would still receive the $270 of benefit from Teresa's generosity. In other words, if Neha decides to keep the $300 for a cell phone and Teresa decides to contribute the $300 to the public project, then Neha would receive a total benefit of $300 $270
Answer:
In other words, if Neha decides to keep the $300 for a cell phone and Teresa decides to contribute the $300 to the public project, then Neha would receive a total benefit of:
$570.
Explanation:
Neha has, in this situation, maximized his benefits to the detriment of the public good. This is an illustration of the tragedy of the commons. The tragedy of the common is an economic problem that explains the loss that the society incurs when some persons like Neha neglect to contribute to the common good because they are solely concentrated on pursuing their individual goals for personal gains.
Some characteristics of the determinants of nominal interest rates are listed as follows. Identify the components (determinants) and the symbols associated with each characteristic:
a. This is the premium that reflects the risk associated with changes in interest rates for a long-term security.
b. Over the past several years, Germany, Japan, and Switzerland have had lower interest rates than the United States due to lower values of this premium.
c. It is based on the bond’s marketability and trading frequency; the less frequently the security is traded, the higher the premium added, thus increasing the interest rate.
d. This is the rate for a short-term riskless security when inflation is expected to be zero.
e. This is the premium added as a compensation for the risk that an investor will not get paid in full.
Answer:
Explanation:
a. This is the premium that reflects the risk associated with changes in interest rates for a long-term security.
(determinants<>Nominal risk free rate)
( The Symbol<> rRF)
b. Over the past several years, Germany, Japan, and Switzerland have had lower interest rates than the United States due to lower values of this premium.
( Determinant<>Inflation premium)
(Symbol<>IP)
c. It is based on the bond’s marketability and trading frequency; the less frequently the security is traded, the higher the premium added, thus increasing the interest rate.
( Determinant<>Liquidity risk premium)
( Symbol<> LRP)
d. This is the rate for a short-term riskless security when inflation is expected to be zero.
(Determinant<> Real risk free rate)
( Symbol<>r)
e. This is the premium added as a compensation for the risk that an investor will not get paid in full.
(Determinant<> Default risk premium)
( Symbol<> DRP)
