How should the weighted marginal cost of funds be used

Assignment Help Financial Management
Reference no: EM13884534

The weighted marginal cost of funds is used in pricing decisions. Explain how it should be used if the loan being priced exhibits average risk. How should the weighted marginal cost of funds be used if the loan carries above average risk?

Reference no: EM13884534

Questions Cloud

List the basic steps in static gap analysis : List the basic steps in static GAP analysis. What is the objective of each?
Create one or more point mutations in sequence : Question1. Translate the following sequence: AUG GAG GUC UUU AAG AGA CAU UUA GAU GUA GCC CUU AGU GAU GUU UAG2. Create one or more point mutations in this sequence: AUG GAG GUC UUU AAG AGA CAU UUA GAU GUA GCC CUU AGU GAU GUU UAG
Considering what you just learned by reading : Considering what you just learned by reading Chapter 12, is it wise for doctors to over prescribe antibiotics? Do you think we have the possibility of creating a "superbug" that we cannot treat?
Synthesize knowledge of cellular : The purpose of this assignment is to test your ability to apply your understanding of cell biology and problem solving. This will be accomplished by having you consider the impact of the types of manipulations of cell systems that biologists routinel..
How should the weighted marginal cost of funds be used : The weighted marginal cost of funds is used in pricing decisions. Explain how it should be used if the loan being priced exhibits average risk. How should the weighted marginal cost of funds be used if the loan carries above average risk?
Estimate the marginal cost of issuing a one million cd : Use the following information to estimate the marginal cost of issuing a $ 1 million CD paying 3.25 percent interest. It has a one- year maturity and the following estimates apply relative to the balance obtained: Acquisition costs = 1/ 8 of 1 percen..
One of the qualifying factors for a third party : One of the qualifying factors for a third party payer to cover bariatric surgery is an extensive psychological examination. Why is this necessary? Do you agree? Why or why not?
What types generate the highest acquisition costs : What types of bank liabilities generate the highest servicing costs? What types generate the highest acquisition costs?
Design a hypothetical : Instructions Design a hypothetical, but plausible, research project using appropriate epidemiological methodologies.Research and summarize basic epidemiological information about your focus.

Reviews

Write a Review

Financial Management Questions & Answers

  Calculate the specific cost of each source of financing

Calculate the specific cost of each source of financing Assume that the required return of retained earnings is equal to that on common stock. If earning is available to common shareholders are expected to be $7 million what is the break point associ..

  What is the new price of the bond using duration

You find a bond with 25 years until maturity that has a coupon rate of 10.0 percent and a yield to maturity of 8.5 percent. Suppose the yield to maturity on the bond increases by .25 percent. What is the new price of the bond using duration?

  Part of the process of cost allocation

Which of the following is not part of the Process of cost allocation?

  Estimate weighted average cost of capital assuming tax rate

The market value of NPU Ice Creamery equity is $8 million and the market value of its debt is $6 million, with book value of debt at $2 million and the book value of equity at $2.5 million.

  What must the coupon rate be on bonds

Hollin Corporation has bonds on the market with 15.5 years to maturity, a YTM of 7.6 percent, and a current price of $1,063. The bonds make semiannual payments. What must the coupon rate be on these bonds?

  The beta associated with risk free asset

The beta associated with a risk free asset ___.

  What is the current value of the annuity

A 5-year annuity of ten $8,000 semi-annual payments will begin 9 years from now, with the first payment coming 9.5 years from now. If the discount rate is 8 percent compounded monthly, what is the value of this annuity five years from now? If the dis..

  The various states or the federal government

Which level of government do you think should regulate the insurance industry, the various states or the federal government? Explain your reasoning.

  The difference between the price and par value of

1 the difference between the price and the par value of a zero-coupon bond represents .a taxes payable by the bond

  Default risk premium

A company's 5-year bonds are yielding 9.9% per year. Treasury bonds with the same maturity are yielding 5.15% per year, and the real risk-free rate (r*) is 2.65%. The average inflation premium is 2.1%, and the maturity risk premium is estimated to be..

  Determine the incremental cash flow effects

Determine the incremental cash flow effects for the bank if it sold the Treasury note and reinvested the full after tax proceeds from the sale in a 6.6 percent three year taxable security, assuming a 34 percent tax rate.

  Weight of debt-weight of preferred stock-weight of equity

Discount rate to use to evaluate the purchase of a new warehouse facility. To finance the purchase, GBH will sell 20 year bonds with a $1,000 par value paying 7.5 percent per year (paid semi annually) , at the market price of $955. Preferred stock pa..

Free Assignment Quote

Assured A++ Grade

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!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd