Post a New Question

Stats

posted by .

Question 3

Investment analysts generally believe the interest rate on bonds is inversely related to the prime

interest rate for loans; that is, bonds perform well when lending rates are down and perform poorly

when interest rates are up. Can the bond rate be predicted by the prime interest rate?

Use the following data to

construct a scatter graph and then fit a regression line to the data.

Report the regression formula and the r-squared value from the chart (right click on the line, select

“Add Trendline” and select options to show these metrics).


Bond Rate/ Prime Interest Rate

5% 16%

12 6

9 8

15 4

7 7

Respond to this Question

First Name
School Subject
Your Answer

Similar Questions

  1. macroeconomics

    The interest rate were zero under the old government.The GDP is $700 and at that time people kept a total of $120 in cash stored as well as %50 worth of bonds. However, under new government the interest rate has risen to 36%. On average, …
  2. finance (higher interest rate)

    A higher interest rate (discount rate) would?
  3. Accounting

    John Doe is in the 40 percent personal tax bracket. He is considering investing in HCA bonds that carry a 12 percent interest rate. a. What is his after-tax yield(interest rate) on the bonds?
  4. survey of accounting

    1. A corporation issues $18,000,000 of 6% bonds to yield an effective interest rate of 7%. a) was the amount of cash received from the sale of the bonds more or less than $18,000,000?
  5. finance

    IBM issued $1,000 30 year bonds. The bonds sold for $936 and pay interest semi-annually. The required rate of return is 7%. wha tis the semiannual interest payment on the bonds?
  6. HealthCare Finance Bonds

    John Doe is in the 40 percent personal tax bracket. He is considering investing in HCA bonds that carry a 12 percent interest rate. a. What is his after-tax yield (interest rate) on the bonds?
  7. Accounting

    Jacks Corporation purchases $200,000 bonds plus accrued interest for 2 months of $2,000 from Kennedy Company on March 1. The bonds have an annual interest rate of 6% payable on June 30 and December 31. The entry to record the purchase …
  8. statistics

    Investment analysts generally believe the interest rate on bonds is inversely related to the prime interest rate for loans; that is bonds perform well when lending rates are down and perform poorly when interest rates are up. Can the …
  9. Finance

    Kim Davis is in the 40% personal tax bracket. She is considering investing in HCA (taxable) bonds that carry a 12% interest rate. a. What is her after-tax yield (interest rate) on the bonds?
  10. Finance

    What is the value of 15-year corporate bonds, with a coupon rate of 9%, if current interest rates on similar bonds is 8%?

More Similar Questions

Post a New Question