University of La Verne College of Business & Public Management Business Finance 500D Online Winter 2013 Assignment #3 This work is due on Sunday February 24 @ Midnight in the Assignment #3 folder of Blackboard. Please post your work file‚ with your name in the file title‚ to the Assignment #3 folder in Blackboard. Question #1: (Twenty Points) Stocks (a). Why is stock ownership considered equity and bond ownership considered debt? In finance you can think of equity as ownership in
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A Shared decision-making process involves having two or more people negotiate or compromise to make a financial decision. Have you ever been involved in a share decision-making process with your family? If so‚ explain the situation and what input you gave to the decision. I have been involved in a share decision-making process with my mom. We had to decide if my mom should use the $2‚000 she saved to buy a new car or pay the past due amount on our old car a Mutang. The Mustang cost $425 a month
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I. Introduction 1. Rationale In the market economy‚ where the relationship between commodity and currency is expanding‚ the demands for capital‚ social and economic exchanges become increasingly necessary and urgent. Commercial banks meet most of the needs of the market economy and they have more advantages than other financial intermediaries. The Communist Party and State have identified an important task in the future to carry out industrialization and modernization of the national economy
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establishment authorized by a government to accept deposits‚ pay interest‚ clear checks‚ make loans‚ act as an intermediary in financial transactions‚ and provide other financial services to its customer: http://www.businessdictionary.com/definition/bank.html#ixzz2qTHMUNiX Loan- An arrangement in which a lender gives money or property to a borrower‚ and the borrower agrees to return the property or repay the money‚ usually along with interest‚ at some future point(s) in time. Usually‚ there is a predetermined
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current liabilities‚ although they do have certain implicit costs. In addition‚ both are forms of unsecured short-term financing—short-term financing obtained without pledging specific assets as collateral. The firm should take advantage of these “interest free” sources of unsecured short-term financing whenever possible. Accounts Payable Management Accounts payable are the major source of unsecured short-term financing for business firms. They result from transactions in which merchandise is purchased
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debt instruments‚ meaning that its interest rate is not fixed (e.g. 8% each year until maturity) but rather tied to something like LIBOR (e.g. LIBOR + 3%). Both Term Loans and Revolvers have interest rates that fluctuate‚ whereas subordinated notes – also referred to as high-yield debt – have fixed interest rates that do not change over time. 2. Which of the answer choices below lists the tranches of LBO debt from Lowest to Highest in terms of typical interest rates? a. Term Loan B; Term Loan A;
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broadly defined into two categories‚ fixed rates and floating (variable) rates. Banks start charging interest from the date the loan is first disbursed. Fixed rates packages in Singapore are normally offered for up to 3 years‚ However‚ some banks may extend up to 5 years fixed rates or even 10 years. After the agreed fixed-rate term is up‚ the interest rate will become variable where the interest rate will be a floating rate. Floating rates in Singapore can be classified into published rates
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Importance of Agriculture in Indian Economy The direct contribution of the agriculture sector to national economy is reflected by its share in total GDP‚ its foreign exchange earnings‚ and its role in supplying savings and labor to other sectors. Agriculture and allied sectors like forestry and fishing accounted for 18.5 percent of total Indian Gross Domestic Product (GDP) in 2005-06 (at 1999-2000 constant prices) and employed about 58 percent of the country’s workforce (CSO‚ 2007). It
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Chapter 10 Problems 1. How much interest would be earned (on a simple interest basis) from a three-day money market loan for $1 million at an interest rate of 12 percent (annual rate)? Suppose the loan were extended on the third day for an additional day at the going market rate of 11 percent. How much total interest income would the money-market lender receive? Interest owed at 12% for 3 days would be: $1‚000‚000 (.12) (3/360)=$1‚000. Additional interest owed for 1 more day: $1‚000‚000
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investing and attempting to predict future recessions given its track record. Investors use the yield curve as a reference point for forecasting interest rates‚ pricing bonds and creating strategies for boosting total returns. The yield curve has also become a reliable leading indicator of economic activity.(PIMCO) A yield curve is a line that plots the interest rates‚ at a set point in time‚ of bonds having equal credit quality‚ but differing in maturities. The most frequently reported yield curve compares
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