Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Liquidity Preference Theory
This theory states that short term bonds are extremely favorable than long term bonds for two (2) purposes.
1. Investors usually prefer short term bonds to long-term securities since such securities are extremely liquid in the sense such they can be converted to cash along with little danger of loss of principal. Hence - investors will agree to lower yields on short term securities.
2. At the same that time borrowers react in just the opposite way.
Usually borrowers prefer long term debt since short-term debt exposes them to the risk of having to repay the debt under adverse. In this situation, accordingly borrowers are willing to pay higher rate another things held constant for long-term procedure than short ones.
Taking together this two sets of preferences implies under such usual conditions, a positive maturity risk premium exist that increases by maturity hence the yield curve should be upward sloping. Lenders prefer liquidity like short term hands whereas borrowers prefer long term bonds and are willing to pay a "premium" for long term borrowing.
what is the financial position of the company in term of leverage, liquidity and fluidity? Were the position better in 2013 compared to 2012 ? Possible ratios : - Levera
continous time finaince expert
how can I get?
Explain about the Internal Rate of Return Internal rate of return (IRR) is the rate of discount that makes the present value of all the revenues (cash flows) from the invest
1) What is the holding period return to an investor who bought 100 shares of Charter Oil nine months ago for $36 a share, received two $50 dividend checks, and sold the s
Question 1: i) Discuss the main risks facing a retail bank in its traditional business of deposit taking and lending? ii) How can a bank manage the risks related to credit
The table below gives data on the average number of football games attended per year among a population of students at a small college, separately by major. All students are in one
Trygdhhsfhkfghj
A firm has a $100 million capital budget. It is considering two project, each costing $100 million. Project A has an IRR of 20%; has an NPV of $9 million; and will be terminated af
J inherited 30000 & decides to open a hair salon.make arrangements 1/4/1016 commits 10000 to the business Opens an a/c under j hair salon What will be the amount under capital in
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!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd