True, because is affected by the purchasing power of Consumer, they will get loan lower interest rate.
QUESTION 10 Cap rates are influenced by the yield on US government bonds and interest rates...
QUESTION 1 If firms decide to raise more funds through the sale of bonds, interest rates will rise. True False 1 points QUESTION 2 If the price of bonds is higher than the market equilibrium then their price will fall and interest rates will fall as well. True False 1 points QUESTION 3 As explained in the text, assets may be financial or non-financial. True False 1 points QUESTION 4 In deciding what assets to hold, people...
Why would we see the prices on US government bonds suddenly rise? Multiple Choice Bond prices can only rise if the US government pays more interest on these investments They would rise if there was suddenly lots of bad economics news like higher unemployment an increase in natural disasters like explding volcanoes, or the start of new wars le China attacks Taiwan), then we would see bond prices rise on US government bonds If we had a sudden explosion of...
The financial markets like predictability of cash flows. Hotels have the shortest leases of all major property types and the leases can be as short as one day. This is why hotels are often thought of as operating businesses. Office leases, by contrast, are longer term and and it is not uncommon to find office leases with 10-year terms or longer. As a result, cap rates for hotels are generally higher than cap rates for office buildings? True False 5...
What are two reasons for low interest rates on US government bonds relative to private bonds?
Question 20 (2 points) The Term Structure of Interest Rates (the yield curve) measures yield and risk of fixed income securities like Treasury bills, notes and bonds. 1) True 2) False
QUESTION 7 All bonds have equal risk of default and thuspay equal rates of interest. True False QUESTION 8 When expected inflation increases and there is no change in nominal interest rates then real interest rates fall. True O False QUESTION 9 Suppose the interest rate in Australia is 1.796, and the expected Australian inflation rate is 0.8%. The real interest rate is O 0.9 O 1.0 O 1.1 O 1.2 QUESTION 10 Suppose the interest rate in New Zealand...
Question 3 10 pts In the guest lecture for this module, David Sobelman and Austin Simmons emphasize that the 3 primary components determining cap rates (and ultimately give value to commercial property) are: location, location, location real estate location, tenant mix, and lease type real estate location, credit of the borrower, and property size property type, property size, and property location none of the above
Yield curve is chart of interest rates (yield) usually with maturities of 1 month to 30 years. The interest rates depicted in the yield curve are of which type? Select one: O a. Annualized rates O b. Forward rates O c. Holding rates O d. Spot rates The relationship between a bond's price (present value) and bond's yield to maturity is inversely proportional; L.e. one goes up when the other goes down and vice versa. Because of that relationship, if...
QUESTION 9 Select all of the following that are true regarding interest rates: Interest rates on bonds rise when the demand for bonds increases regardless of risk US Quantitative Easing causes all interest rates to fall Interest rates fall when the economy grows since the central bank is providing stimulus As the yield curve flattens, all interest rates fall Interest rates are controlled by the central bank Interest rates fall to attract investors since it indicates lower risk
Question 14 I. The interest earned on the holding of US government bonds by foreigners: a. would be recorded as a debit (-) in the US capital account b. would be recorded as a credit (+) in the US current account c. would be recorded as a debit (-) in the US current account d. would be recorded as a credit (+) in the US capital account II. The purchase of US government bonds by foreigners: e. would be recorded...