The investors who want cash flows in near terms shows preference for__________?
Correct answer: C. interest portion of STRIPS
- A. interest portion of RIAPS
- B. interest portion of STORI
- C. interest portion of STRIPS
- D. interest portion of bondsCompare Personal Loans
Explanation
STRIPS separate a Treasury security into individual principal and interest cash flows, allowing investors to select maturities that match their needs. Investors seeking near-term cash flows can therefore choose short-maturity interest STRIPS.
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About Business Finance
Business finance explains how organisations plan, obtain and use money while balancing risk, return and liquidity. Topics include financial statements, time value of money, budgeting, working capital, capital structure, sources of finance, investment appraisal and cost of capital. Capital budgeting evaluates long-term projects, whereas working capital manages day-to-day operations.
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