Implications of all of with respect to nationwide branchings

Assignment Help Financial Management

Reference no: EM13975243

Suppose interest rates on residential mortgages of equal risk are 5.5% in California and 7% in New York. Could this differential persist? What forces might tend to equalize rates? Would differentials in borrowing costs of business of equal risk located in California and New York be more or less likely to exist than differentials in residential mortgage rates? Would differentials in the cost of money for New York and California firms be more likely to exist if the firms being compared were very large or if they were very small? What are the implications of all of this with respect to nationwide branching?

Reference no: EM13975243

Questions Cloud

Explain the difference between factoring and pledging : Define the factoring of accounts receivable. How does factoring affect cash management? Explain the difference between factoring and pledging?

Conducts customer segment research : B&B has a new baby powder ready to market. If the firm goes directly to the market with the product, there is only a 55 percent chance of success. However, the firm can conduct customer segment research, which will take a year and cost $1.2 million. ..

Preferred stock outstanding : Bullseye, Inc.'s 2008 income statement lists the following income and expenses: EBIT = $703,500, Interest expense = $53,000, and Taxes = $220,500. Bullseye's has no preferred stock outstanding and 270,000 shares of common stock outstanding. What are ..

Cross-tabulation describing the compressors : a. Construct a simple tabulation in which the counts are according to which company supplied the mechanical components. b. Construct a cross-tabulation describing the 100 compressors tested, using mechanical supplier and electrical/ moto..

Implications of all of with respect to nationwide branchings : Suppose interest rates on residential mortgages of equal risk are 5.5% in California and 7% in New York. Could this differential persist? What forces might tend to equalize rates? Would differentials in borrowing costs of business of equal risk locat..

How would you rate dinsmore hotel : Case - A Comment on Management Attitude. How would you rate Dinsmore's hotel? What evidence would you provide to support your position

What is an aggressive financing strategy : What is an aggressive financing strategy? What are the components and under what circumstances would you use either model?

Take advantage of a long term investment opportunity : Let's say that a company has actually reformed relatively well long term and an investor has reformed research and has made a decision to invest in a dividend paying organization. However, instead of aying out an increased dividend amount giving inve..

Now assume that the discount rate changes across periods : Now assume that the discount rate changes across periods. In specific, the discount rate for period 1 (discounting from period 1 to period 0) is r1 = 10%, the discount rate for period 2 (discounting from period 2 to period 1) is r2 = 8% and the disco..

User Account

All Pages