Explain why a weak economy may cause the risk premium to rise.
Answer to relevant QuestionsWhy is a high risk premium is an advantage for the investor? Why is a low risk premium an advantage for the investor? Name some special services that banks provide. How might you make use of them? Randy, a student, has $ 500 to deposit in a new checking account, but Randy knows he will not be able to maintain a minimum balance. He will not use an ATM card, but will write a large number of checks. Randy is trying to ...What are Treasury securities? What is a T- bill? How is it denominated? How do you earn a return on a T- bill? How is the return calculated? What is liquidity? How is your personal cash flow statement used to help manage your liquidity? How does money management relate to the cash flow statement?
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