When the present value of an investment increases as interest rates increase it is known as a forward interest rate
True
False
We need at least 10 more requests to produce the answer.
0 / 10 have requested this problem solution
The more requests, the faster the answer.
When the present value of an investment increases as interest rates increase it is known as...
If the present value (PV) of an investment project that requires an initial investment of $2,000,000 is $500,000, its net present value (NPV) is -$1,500,000 True False QUESTION 7 30-day forward rates are the same as spot exchange rates. True False
the interest rate increases, net present value: Increases Could increase or decrease Does not change Decreases If you determine that the present value of a stream of payments is $20,000 and the immediate investment required to get that stream of payments is $28,000, do you make the investment? Dolphin's are friendly No Yes Need more information The intersection of the demand curve can be used to: Identify the economic value of the good or service exchanged Both of the above...
4. Interest rates and their effect on corporate profits and investment prices Interest rates affect corporate profits and security prices. Based on your understanding of the relationship between interest rates and corporate profits and security prices, identify which of the following statements is true and which are false. True False Ststements The higher the interest rate on a firm's debt, the lower will be the firm's profits, all other considerations remaining constant. An increase in the interest rate paid by...
The interest rate that makes the net present value of the investment equal to zero is the internal rate of return. True False
7) Given the relationship between interest rates and planned investment planned investment A) increases if the interest rate drops from 6% to 4%. B) increases if the interest rate rises from 6% to 8%. C) is unaffected by any changes in interest rates. D) both A) and B) are correct. 8) To combat a recession with fiscal policy, the government should A) reduce government spending. B) reduce taxes on consumers to increase consumer disposable income. C) lower interest rates and...
If market interest rates increase, investors in corporate bonds will see the current market value of their bonds do what in the secondary market? a. If the market interest rates increase, the coupon rate on the bond increases b. When market interest rates increase, the market value of corporate bonds increase c. Remain the same, because the face value never changes d. When market interest rates increase, the market value of corporate bonds decrease
What happens when the price level rises? a. Interest rates rise, so firms increase investment. b. Interest rates rise, so firms decrease investment. c. Interest rates fall, so firms increase investment. d. Interest rates fall, so firms decrease investment. 44. Which of the following shifts money demand to the left? a. an increase in the price level b. a decrease in the price level c. an increase in the interest rate d. a decrease in the interest rate 45. If the world real interest rate exceeds the Canadian real interest...
If the price level increases, then which of the following will happen? a. Interest rates will increase and hence investment will decrease b. Interest rate will decreases and investment will increase c. Both Interest rate and consumption will increase d. Both Interest rate and investment will decrease
Present Value of a Perpetuity What's the present value, when interest rates are 6.70 percent, of a $270 payment made every year forever? 4,029.85 18.09 2,700.00 1,809.00
If interest rates increases, the Eurodollar futures price also increases. True False