Elaborate on the concepts of debt vs. equity financing

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1. Since January 2017 the dollar has been losing value (depreciating) against most major currencies in particular the Euro. The depreciating dollar is surprising given the strong U.S. economy. In addition, the recently passed tax cut insures the U.S. will be financing an even larger annual deficit. This will put even more pressure on interest rates to attract buyers for U.S. government bonds. What are your thoughts on why the dollar is declining?

2. Compute the bid-ask spread percentage rate for the Euro versus the US $, when the bid rate is €0.82 and the ask rate is €0.85

3. Elaborate on the concepts of debt vs. equity financing. What are the advantages and disadvantages to a taxpaying entity in issuing debt as opposed to equity?

Reference no: EM131968420

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