What does the annual effective yield represent?

Q: Define constant yield method

A: It is the method of ascertaining the collected discount of securities that trade the secondary…

Q: What is the Equivalent Annual Operating Cost?

A: Equivalent annual cost (EAC) is the yearly expense of owning, managing, and operating an asset over…

Q: What is optimal capital budget?

A: Budget: The estimation of the income and expenditure of the particular future period and is…

Q: How is the revaluation surplus handled under the revaluation model?

A: The question is related to Revaluation model under IAS16 Property, Plant and Equipment. Under this…

Q: Explain the term Annual Effective Yields?

A: Annual effective yield: Annual effective yield is defined as the simple rate of interest that gives…

Q: How can we find Yield to maturity?

A: Yield to maturity (YTM) is the foreseen absolute profit for a bond if the bond holds until due or…

Q: Write the various applications that call for annual-worth analysis techniques?

A: Annual worth analysis is the analysis which is done by the managers before taking capital budgeting…

Q: An upward-sloping yield curve

A: An upward sloping yield curve: may reflect the confounding of the liquidity premium with interest…

Q: Factors that Affect Yield to Maturity

A: A bond's yield to maturity depends basically on its present value, coupon rate and the time to…

Q: on. What is the maximum profit possible?

A: In the given question, we have to compute maximum possible profit out of the given availability of…

Q: What should be the unit selling price of its product to have a 20% return on investment?

A: Invested capital of the business means amount of assets and capital that is being invested. Every…

Q: What is the equivalent total investment cost (future worth)?

A: Answer: Equivalent total investment cost (future worth) method discounted cash flow method converts…

Q: Expected rate of return.

A: Risk-free rate:   This can be described as the rate of return of the asset which has zero risks.…

Q: What is the Net Present Value (NPV) of the yearly (annual) capital budgeting cost?

A: While choosing which investment project will be undertaken, different appraisal techniques are used.…

Q: Explain APY (annual percentage yield)?

A: APY (Annual Percentage Yield):   It is the real return rate that is earned on an investment during a…

Q: What was her dollar-weighted annual yield rate? Compute it exactly, and compare to using the…

A: Dollar weighted annual rate is that rate of return where present cash inflows are same as present…

Q: What should be multiplied to the quantity of final products of the current year if we want to…

A: National income at constant prices: If goods and services produced in a year are valued at fixed…

Q: How to calculate yield to maturity

A: Yield to Maturity: The yield to maturity (YTM) of a bond is the cumulative return expected if the…

Q: What is a yield curve? What does it mean when the yield curve is inverted?

A: Yield curve tells the relationship between the short term interest rates and long term interest…

Q: Describe the specific process required by the unit cost comparison for the use of annual worth…

A: A unit cost comparison is required for the use of annual worth analysis because companies often…

Q: Identify the different types of yield curves and explain what they indicate for the U.S economy?…

A: The yield curve shows the graphical representation of a line drawn which states the relationship…

Q: Could the current yield exceed the total return?

A: A financial instrument that has a fixed income and also helps a company to raise funds for business…

Q: Why is an incremental analysis necessary when conducting a rate of return analysis for cost…

A: Incremental analysis considers only the relevant cash flows and it does not consider the…

Q: Give an example on annual rate of return method

A:

Q: How much is the equivalent annual cost of Model X?

A:

Q: Define the term Annual operating cost:?

A: MEANING OF OPERATING COST The sum total of operating expenses and cost of goods sold is called…

Q: What are the Relationship between Yield and Time?

A: Yield refers to the measurement of returns of an investment in a period of time. It measures the…

Q: How do you calculate yield to maturity?

A: The yield to maturity is nothing but the interest rate of a bond. It can also be termed as the…

Q: What is the difference between cumulative return and annualized return/CAGR). Provide an example

A: There are two methods to measure the rate of return annual basis and cumulative basis.

Q: inverted

A: An inverted yield curve is a curve which shows that the company's long term debt instruments have a…

Q: What is the Total equivalent annual cost?

A: Equivalent annual cost (EAC) is the annual cost of claiming, overseeing, and supporting an asset…

Q: Explain the Annual Effective Yields at Various Compounding Intervals?

A: The effective annual rate of interest is the actual or the real rate of interest paid or received…

Q: Explain the difference between the yield to maturity and the yieldto call.

A: Bonds are the fixed income securities issued by the government or companies to raise funds from the…

Q: How can we apply Annual-Worth Analysis for the calculation of Unit-Profit or Unit-Cost Calculation?

A: Annual worth analysis is an analysis of value of an investment on an annual basis. It measures the…

Q: In the marine resource model, there is a sustained yield for each effort level. Explain how the…

A: The yield curve is a line that represents the yield (interest rate) of bonds with the same credit…

Q: Explain an upward sloping yield curve using the pure expectation theory.

A: Pure expectation theory: Pure expectation theory states that expected future spot rates will be…

Q: How is a future worth yield?

A: Future worth yield is equals to future return on a particular amount. Future value is the value of…

Q: What is the difference between yield to maturity and current yield? Explain

A: Bond is a debt instrument issued by companies and government. It is a fixed income instrument which…

Q: a) What is the level of saving rate that maximizes consumption at the steady state?

A: 1. In Solow’s growth model, a high level of savings leads to a large steady-state capital stock and…

Q: Calculate the present value PV (in dollars)

A: Today’s worth of dollars at a later date is the Present Value of the dollar. For example, the value…

Treasury Market

On-the-run securities are the most recently issued securities in the market depth and are therefore traded at some premium. The off-the-run securities are the ones issued just before the most recent ones. The on-the-run securities have a lower yield to the investor than the off-the-run securities.