The quoted rate of interest is calculated using the following formula. Quoted Rate = r* + IP + DRP +LP + MRP Given the following information what is the risk free rate (RF) of the quote of the US Treasury Bill r* = 2% IP = 3% DRP = 3% LP = 3% MRP = 4% 2% Select 5% as your answer 5% Select 8% as your answer 8% Select 15% as your answer 15%

The quoted rate of interest is calculated using the following formula. Quoted Rate = r* + IP + DRP +LP + MRP Given the following information what is the risk free rate (RF) of the quote of the US Treasury Bill r* = 2% IP = 3% DRP = 3% LP = 3% MRP = 4% 2% Select 5% as your answer 5% Select 8% as your answer 8% Select 15% as your answer 15%

Entrepreneurial Finance

6th Edition

ISBN:9781337635653

Author:Leach

Publisher:Leach

Chapter7: Types And Costs Of Financial Capital

Section: Chapter Questions

Problem 2EP

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The quoted rate of interest is calculated using the following formula. Quoted Rate = r* + IP + DRP +LP + MRP Given the following information what is the risk free rate (RF) of the quote of the US Treasury Bill r* = 2% IP = 3% MRP = 3% LP = .6% DRP = .4%
Given the following, construct a choice table for interest rates from 0% to 100%. Year X Y 0 −$10 −$20 1 15 28
Use factors and a spreadsheet to determine the interest rate per period from the following equation: 0 = -26,000 + 8,000(P/A,i∗,5) + 8,000(P/F,i∗,8) What is the interest rate per period? %
Let's define the followings: r = real interest rate i = nominal interest rate I = inflation What is the real interest rate if the nominal interest rate is 3% and inflation is 2%? Group of answer choices: 2% 5% 1% 0%
Consider the following money market information being quoted: Which of the following statements is true? Particulars GBP Interest Rate THB Interest Rate Spot Rate 1-year Expected Spot Rate Bid Rate 6.100% 10.550% THB5.6601/GBP THB5.9037/GBP C. Ask Rate 6.125% 10.625% THB5.6622/GBP THB5.9961/GBP a. There is an arbitrage which can only be made by initially borrowing GBP and then investing in THB. b. More than one of the options in this question are correct. The THB is selling at a premium to the GBP in the future. O d. There is an arbitrage which can only be made by initially borrowing THB and then investing in GBP.
Interest rates or discount rates. Fill in the interest rates for the following table using one of the three methods below: a. Use the interest rate formula, r=FVPV1n−1. b. Use the TVM keys from a calculator. c. Use the TVM function in a spreadsheet. Present Value Future Value Number of Periods Interest Rate $ 493.61 $ 1,902.61 20 ? $17,077.77 $228,416.84 32 ? $34,251.51 $ 63,755.61 24 ? $26,813.61 $212,279.67 10 ? Present Value Future Value Number of Periods Interest Rate $ 493.61 $ 1,902.61 20 nothing% (Round to two decimal places.) $17,077.77 $228,416.84 32 nothing% (Round to two decimal places.) $34,251.51 $ 63,755.61 24 nothing% (Round to two decimal places.) $26,813.61 $212,279.67 10 nothing% (Round to two decimal places.)
For part d, told to manipulate the equation: ΔM(t)= rM(t)Δt M(t) represents the money value at time t E is the final value of the note r is the interest rate Δt is expiration minus today's date
The following data are gathered for: · The real risk-free rate is 1.25% · Inflation premium is constant at 2.50% · Default risk premium is 5% · Liquidity risk premium is 0.50% What is the quoted rate on a short-term government security? (Format: X.XX%)
Use factors (from the tables) or a spreadsheet to determine the interest rate per period from the following equation: 0 = −40,000 + 8000(P/A,i*,8) + 8000(P/F,i*,10)
Calculate the interest rate for the following present value, time and future value:PV=38,261; t=50; FV= 531,618a) 10.50b) 7.36c) 5.40d) 13.87
Interest rates or discount rates. Fill in the interest rates for the following table, , using one of the three methods below: FV a. Use the interest rate formula, r= PV - 1. b. Use the TVM keys from a calculator. c. Use the TVM function in a spreadsheet. Present Value Future Value Number of Periods Interest Rate 529.63 5 1,884.87 20 6.55 % (Round to two decimal places.) $17 207.92 $223,893.69 40 % (Round to two decimal places.)
Which one is correct answer please confirm? Q1: If the return on U.S. Treasury bills is 7.02%, the risk premium is 2.32%, and the inflation rate is 4.16%, then the real rate of return is ____. a. 2.86% b. 7.02% c. 4.70% d. 6.48%