four factors that drive the current level of interest rates:

four factors that drive the current level of interest rates: inflation, maturity, default risk, and prepayment risk. Do you think interest rates on corporate bonds will go up or down over the next year? Which factor is most important in explaining your current interest rate outlook for corporate bonds? Explain.

A U.S. company has sales to Canada amounting to C$5 million. Its

A U.S. company has sales to Canada amounting to C$5 million. Its cost of materials attributable to the purchase of Canadian goods is C$7 million. Its interest expense on Canadian loans is C$5 million. (1) Calculate the dollar value of the company’s cash flows at an exchange rate of C$/US$.90; (2) Would the dollar value of the company’s cash flows increase or decrease with an exchange rate of C$/US$.95 and by how much? Show how you derive your answer.