What happens if the expected default rate rises to 8 percent

Assignment Help Econometrics
Reference no: EM131403084

If the expected default rate on a particular mortgagebacked security is 4 percent per year, and the corresponding Treasury security carries a 3 percent annual interest rate, what should be the interest rate on the mortgage-backed security? What happens if the expected default rate rises to 8 percent?

Reference no: EM131403084

Questions Cloud

Account executive for that magazine publisher : Think about your two companies from week 3 assignment. Pick a real (meaning non fictitious) magazine in which one of your companies may want to advertise. Pretend you are the account executive for that magazine publisher,
What is required of the corporation to claim the tax credit : What is required of the corporation to claim the tax credit? Discuss your opinion on the use of tax credits to minimize payment of taxes. Who benefits? Consider both the social impact and the boost to retained earnings.
Research of the sports landscape : For each of the situations listed below, provide an explanation/rationale of examples in sports where you feel the associations are strong based on your knowledge and accompanying research of the sports landscape by answering the following:
What was your total return for last year : FIN/571- Total Return: You bought a share of 4% preferred stock for $100 last year. The market price for your stock is now $120. What was your total return for last year?
What happens if the expected default rate rises to 8 percent : what should be the interest rate on the mortgage-backed security? What happens if the expected default rate rises to 8 percent?
Achievement of objectives : Explain why it is a good idea to discuss marketing objectives and progress toward achievement of objectives with customers and personnel responsible for each element of the marketing mix. In your answer, list and expand on at least five of the obj..
Money marketing a new online store : Your organisation has spent a great deal of time and money marketing a new online store. What monitoring strategies that might be useful in this situation? Provide at least three examples and do not limit your answers to ideas provided in the text..
Define the ccc and explain its use and importance : Define the CCC and explain its use and importance. Calculate the CCC for your selected company and for one of your company's competitors.
Traditional keyboarded entry : Note: Your initial discussion post and / or reply(ies) can be the traditional keyboarded entry, or you can use a video response (See the Job Aid in the Student Center of the online course).

Reviews

Write a Review

Econometrics Questions & Answers

  Design a simple econometric research project

Design a simple econometric research project

  Multiplicative decomposition method

Multiplicative decomposition method

  Market for cigarettes

The Australian government administers two programs that affect the market for cigarettes.

  Solve the forecast model

Solve the forecast model

  What are the marginal abatement cost functions

What are the marginal abatement cost functions for each of the two areas? Calculate the loss in the two areas due to over-control (for the rural area) and under-control (for the urban area).

  Write the t statistic for testing the null hypothesis

Explain why this model violates the assumption of no perfect collinearity.  Write the t statistic for testing the null hypothesis

  What is economics system

What is economics system? What are the types of economics system? Briefly explain each type of economics system by giving examples of nations that are close to each type

  Multiple choice questions related to market concentration

Determine when a competitively produced product generates negative externalities in production, the industry will,

  Calculating number of units produced by firm

Assume a company has the following production function: Q = 100 K.5 L1 . Currently, the company hires 1,000 workers and employs 100 units of capital.

  Question about mobile commerce

M-commerce also known as mobile commerce is being lumped in with several strategic internet plans. Explain some of the industries that are likely to use mobile commerce and how it is working for them.

  Calculating the average days past due and average flow time

Auto Data manufactures custom engineering testing machine. The following 5-orders are currently in the design department:

  Mechanism of an english auction and second price auction

Briefly discuss the difference between mechanism of an oral or English auction and a Vickrey or second price auction.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd