Gradebook Emai! Live Doc Sharing Dropbox Journal Web 16. Governments do not issu

Question

Gradebook Emai! Live Doc Sharing Dropbox Journal Web 16. Governments do not issue stocks because: (Points : 3) O they cannot sell ownership claims O they cannot sell debt claims the Constitution expressly prohibits it O they cannot compete effectively with corporations relative to profits , whereas lenders prefer O fixed-rate loans; ARMs; fixed-rate loans ARMs; fixed-rate loans; fixed-rate loans fixed-rate loans. ARMS; ARMS ARMs; fixed-rate loans; ARMs 18. During the last years of an amortizing mortgage loan, the lender applies (Points 3) @ most of the monthly payment to the outstanding principal balance all of the monthly payment to the outstanding principal balance most of the monthly payment to interest on the loan all of the monthly payment to interest on the loarn the monthly payment equally to interest on the loan and the outstandin principal balance 19. At the (whatever date) auction, 52 week Treasury bills were sold at a price of $9,186.10 per $10,000. The actual return (investment yield) on that bill was nearest: (Points: 3) 4.25% 6.09p

Explanation / Answer

Question No :16 Answer is : They can not sell Ownership claims Stocks are shares of ownership in a private company. Since the government is not a private company it cannot issue stock. Investors are generally buy stocks to earn Profits but governamnets do not earn profits, investors never interested in investing in Stocks of govenaments. Governments issue bonds, which are IOUs, promises to repay borrowed money Question No 17 Answer : Fixed rate loans ; ARMs ; ARMs Borrowers tend to prefer fixed rate loans to ARM ,   whereas lenders prefer ARM Lenders prefer Adjustable rate Mortgage , it changes according to the Market condiations and generally lower then the Fixed rate loan. Question No:18 Answer is :   most of the monthly payment to the outstanding principal balance During the initial years of Mortgaging , Monthly Payment Comprised most of the protion is Interest and Lessor Portion is principal. as Period Continious Interest Portion will reduce and Principal portion will increse .   In the last years of Mortgaging the Montly payment comprise of less portion of interest and most of the payment only towords outstand principal.

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