Why are equity investment returns typically more than bond r

Assignment Help Financial Management
Reference no: EM13783713

Why are equity investment returns typically more than bond returns?

A) Equities are riskier than bonds

B) Bonds are riskier than equities

C) Bonds pay interest payments

 

D) Both A & C

Reference no: EM13783713

Questions Cloud

Defense attorneys and avoiding tyranny : Defense Attorneys and Avoiding Tyranny The founding fathers crafted a purposeful tension between each branch of government and between the powers exercised by the state and federal systems. The American criminal justice system is a continuation of th..
Probability tree-marginal-conditional-joint probabilities : A metropolitan school system consists of three districts north, south, and central. The north dis-trict contains 25% of all students, the south district contains 40%, and the central district contains 35%. A minimum-competency test was given to all s..
What could be detailed steps that bring about regulatory arb : What could be detailed steps that bring about regulatory arbitrage by the bank not resident in Eurozone issuing Euro-denominated covered bonds?
How important is first line supervisory training : Case Study - Supervision How important is First Line Supervisory Training? Do you agree with the manner in which Sergeant Rick handled this situation? How would you have handled this situation?
Why are equity investment returns typically more than bond r : Why are equity investment returns typically more than bond returns? A) Equities are riskier than bonds B) Bonds are riskier than equities C) Bonds pay interest payments   D) Both A & C
What value of ordering cost would its action be optional : Henry Crouch's law ofice has traditionally ordered ink refills 65 units at a time. The firm estimates that carrying cost is 45% of the $12 unit cost and that annual demand is about 240 units per year. The assumptions of the basic EOQ model are though..
Briefly list and describe the various stages of the invest : What problem was identified? What steps were taken to solve the problem? Briefly list and describe the various stages of the investigation as the investigation progressed and what strategies were employed. Identifying and catching the criminal was no..
Steady-state probabilities-transition matrix algebrically : A city is served by two newspapers the Tribune and the Daily News. Each Sunday reader purchases one of the newspapers at a stand. The following transition matrix contains the probabilities of a customer’s buying a particular newspaper in a week, give..
Determine the future value as of the last payment of an an : Perpetuity 1 has cash flows at periods 1 through infinity and a value at period 0 of 7021.43 using an interest rate of 14%. Perpetuity 2 has the same cash flows, but starts at a later date. Its value at period 0, using the same 14% interest rate, is ..

Reviews

Write a Review

Financial Management Questions & Answers

  Compute net paid holidays worked for a full-time employee

the metropolis health system managers are also working on their budgets for next year. each manager must annualize his or her staffing plan, and thus must convert staff net paid days worked to a factor.

  What are the present ratios of the stock prices

What are the present Ratios of the stock Prices to Book Value and what would be material for companies as large as the ones you are working with - what can CB&M do to make them more profitable?

  Question 1we have a first to default derivative written on

question 1we have a first to default derivative written on two obligors a and b. the survival probabilities are

  What is the firms net income and after-tax dividend

Assume that Provident Health System, a for-profit hospital, has $1 million in taxable income for 2011, and its tax rate is 30 percent. Given this information, what is the firm’s net income? (Hint: net income is what remains after taxes have been paid..

  What rate of interest will you be earning

Your broker offers to sell you a note for $13,250 that will pay $2,345.04 per year for 10 years.  If you buy the note, what rate of interest will you be earning?

  Dollar annual cost of financing its receivables balance

Ocala Clinic's services result in $5,000 in daily billings to third-party payers. On average, it takes the clinic 50 days to collect its receivables. If the interest rate on loans needed to finance receivables (cost of carrying receivables) is 10 per..

  Mistakenly made public the personal information

Spotlight on AOL— Common Law. AOL, LLC, mistakenly made public the personal information of 650,000 of its members. The members filed a suit, alleging violations of California law. AOL asked the court to dismiss the suit on the basis of a “forum- sele..

  Property held as a personal residence cannot be depreciated

If an individual actively participates in the management of a rental property, he may deduct the full amount of the passive activity losses from active income, regardless of his adjusted gross income. Property held as a personal residence cannot be d..

  About pricing through a channel of distribution

This problem is about pricing through a channel of distribution. The product is shoes. The total landed cost to the importer is $20 for a pair of shoes (to their warehouse from any manufacturer around the globe).

  Estimate of the corporate bonds default risk premium

Assume you make the following investment: a $10,000 investment in a 10year T-bond that has a yield of 10.5% and A $20,000 investment in a 10 year corporate bond with an Baa rating and a yield of 13.7%. Based on this information, what is your estimate..

  Portfolio consists-treasury bills-risk level equivalent

Your portfolio has a beta of 1.24. The portfolio consists of 13 percent U.S. Treasury bills, 28 percent stock A, and 59 percent stock B. Stock A has a risk level equivalent to that of the overall market. What is the beta of stock B? Provide detailed ..

  Calculate the two projects npvs

Filkins Fabric Company is considering the replacement of its old, fully depreciated knitting machine. Two new models are available: Machine 190-3, which has a cost of $220,000, a 3-year expected life, and after-tax cash flows (labor savings and depre..

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