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.
Calculate total number of ordinary shares Example Company XYZ Ltd has sold 10,000 ordinary shares of Shs.30 as partly called up plus 20,000 Shs.45 preference shares, tha
Growth rate : The average of PC manufacturing industry growth rate was 22.24% for 2004, 20% for 2005, and 17.29% for 2006. It showed that the industry's growth rate has been declin
what is the nature and function of money?
Problem: Cash Flow Analysis For the attached Gantt chart, the following information is available: Invoices are sent at the end of each month. Mark up is 20% on each invoi
Joint Stock Companies - Types of Business Organisations Initiators contribute to the capital support of those companies via the purchase of shares of those companies. These co
You are asked to select three variables for a sensitivity analysis of weighted average cost of capital, what would you choose and why? Weighted average cost of capital is th
Cost of Redeemable Debentures and Preference Shares Redeemable fixed return securities have an exact maturity period. The cost of those securities is called redemption yield
some report about credit bank
From the following cost, production and sales data of Decors Motor Ltd., prepare comparative income statement for three years under (i) absorption costing method, and (ii) marginal
Determine the Component of Return Rate of return from an investment consists of the two: (i) Yield: Interest or dividend received is called yield. (ii) Capital Appreci
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