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Q. Show the Disadvantages of adjusted discount rate?
(1) The risk premium rates resolute under this method are arbitrary. Therefore this method mayn't give objective results.
(2) In this method the risk is compounded over time since the risk premium is added to the discount rate. Which signifies this method presumes that risk necessarily increases with the passage of time? However this may not happen in all situations or cases.
(3) This method assumes that investors are averse to risk I that is investors avoid facing risk). This mayn't be true in all cases. There are several investors who would like to take risk and are prepared to pay premium for taking risk.
All other things held constant, how would the market price of a bond be affected if coupon interest payments were made semiannually instead of annually? The majority of bonds i
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Certified Public Accountant (CPA) - ACCOUNTANT who has satisfied education, experience and examination requirements of her or his jurisdiction essential to be certified as a public
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