The main disadvantage of a flexible spending plan is that you may lose any money remaining in the account at the end of the fiscal year

The ________ is cited by the author as a reason for using just one rate, a long-term yield, as the average cost of debt financing for a firm that has multiple issues of debt with varying maturities

A) efficient markets hypothesis B) market substitution theory C) biased expectation theory D) unbiased expectations theory

The 3-year swap price on a new oat swap agreement is $5.94. Interest rates immediately rise on 1, 2, and 3-year zero coupon bonds from 5.1%, 5.4%, and 5.7% to 5.2%, 5.6%, and 6.0%, respectively

What is net swap payment per year if the reverse transaction occurs? Assume year 1, 2, and 3 forward prices are $2.05, $2.15, and $2.30, respectively and do not change. A) $0.35 B) $0.49 C) $0.64 D) $0.75