Explain why interest rates change in the economy and the impact on the yield curve. Break down the determinants of market interest rates. Explain how changes in the yield curve affect the organization’s cost of financing.
Organizations must obtain money to exist. Think about the balance sheet; assets equal liabilities (debt) plus equity . Even equity financing has a cost; no one would want to invest in a company if they were not going to get a return. Organizations must provide the minimum return that investors require to let the organization […]