A yield curve that reflects relatively similar borrowing costs for both short-term and long-term loans is...
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A yield curve that reflects relatively similar borrowing costs for both short-term and long-term loans is called as ________. |
Homework Answers
Flat yield curve
Yield curve is a graph that shows the yields at different maturities of securities. Hence if the curve shows the same borrowing costs for both short term and long term loans, it will be more or less flat in shape.
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A yield curve that reflects relatively similar borrowing costs
for both short-term and long-term loans is...
The cost of long-term borrowing is usually higher than the cost of short-term borrowing. The graph...
The cost of long-term borrowing is usually higher than the cost of short-term borrowing. The graph that shows the relationship between maturity and interest rates for U.S. Government’s borrowings (Treasuries) is called “term structure of the interest rates” or “the yield curve”. Shape of the yield curve is often used by economists to forecast future status of the economy 1. Discuss why long-term rates are usually higher than short-term rates (upward yield curve) 2. Discuss under what economic conditions long-term...
Why is borrowing short term often the best solution? When is short term borrowing a bad...
Why is borrowing short term often the best solution? When is short term borrowing a bad idea? What are interest rates doing when short term borrowing is recommended and what are they doing when long term borrow is better?
Which of the following is NOT true: Yields on long-term bonds are always higher than short-term...
Which of the following is NOT true: Yields on long-term bonds are always higher than short-term bonds. The yield curve charts the annual interest rates paid on bonds of various maturities. None of these. Investors compare the yields of securities of various maturities to understand the prospects for future market growth and inflation. The slope of the yield-curve reflects investor sentiment about the overall health of the economy.
8. The expectations theory suggests that: the yield curve should usually be downwardr sloping the slope...
8. The expectations theory suggests that: the yield curve should usually be downwardr sloping the slope of the yield curve depends on the expected future path of short-term rates. the slope of the yield curve reflects the risk premium incorporated into the yields on long-term bonds. the yield curve should usually be upward-sloping. A. B. D.
A bank's largest liability is its shareholder equity. short-term borrowing. deposits of its customers. long-term debt.
A bank's largest liability is its shareholder equity. short-term borrowing. deposits of its customers. long-term debt.
Aa Aa 12. Short-term financing Why use short-term financing? Cash flows from operations may not be sufficient for a fir...
Aa Aa 12. Short-term financing Why use short-term financing? Cash flows from operations may not be sufficient for a firm to keep up with growth-related financing needs, or the firm may not be able to always generate enough cash flow to maintain a surplus of cash. Firms prefer to borrow now to fulfill their capital requirements through means of short-term financing or long-term financing. Both methods have their advantages and disadvantages. The following statement identifies a possible characteristic of short-term...
Financial intermediaries involved in shadow banking typically: A. accept long-term deposits and make long-term loans. B....
Financial intermediaries involved in shadow banking typically: A. accept long-term deposits and make long-term loans. B. borrow money short term and lend or invest long term. C. borrow money long term and lend or invest short term. D. accept short-term deposits and make short-term loans.
what is the spread between short and long term yield for 4 zero coupons with $10000...
what is the spread between short and long term yield for 4 zero coupons with $10000 face value with the ff term and price. term price 1 yr 9700.87 2 yr 9333.51 3 yr 8880.99 4 yr 8220.70 how can the curve be described?
What risks does a bank take if it funds long-term loans with short-term deposits? (Risk management...
What risks does a bank take if it funds long-term loans with short-term deposits? (Risk management course)
10. Ierust Plus and decisions Suppose that a firm is facing an upward-sloping yield curve and...
10. Ierust Plus and decisions Suppose that a firm is facing an upward-sloping yield curve and needs to borrow money to invest in production. Does this mean that the firm should consider borrowing only at short-term rates? No, the firm needs to take the volatility of short-term rates into account. Yes, using short-term financing will give the firm the lowest possible interest rate over the life of the project. No, an upward-sloping yield curve means that the firm will get...
8. The expectations theory suggests that: the yield curve should usually be downwardr sloping the slope of the yield curve depends on the expected future path of short-term rates. the slope of the yield curve reflects the risk premium incorporated into the yields on long-term bonds. the yield curve should usually be upward-sloping. A. B. D.
Aa Aa 12. Short-term financing Why use short-term financing? Cash flows from operations may not be sufficient for a firm to keep up with growth-related financing needs, or the firm may not be able to always generate enough cash flow to maintain a surplus of cash. Firms prefer to borrow now to fulfill their capital requirements through means of short-term financing or long-term financing. Both methods have their advantages and disadvantages. The following statement identifies a possible characteristic of short-term...
10. Ierust Plus and decisions Suppose that a firm is facing an upward-sloping yield curve and needs to borrow money to invest in production. Does this mean that the firm should consider borrowing only at short-term rates? No, the firm needs to take the volatility of short-term rates into account. Yes, using short-term financing will give the firm the lowest possible interest rate over the life of the project. No, an upward-sloping yield curve means that the firm will get...
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