Assuming an expected default rate in 1991 of 10% and a 30% recovery rate (both reasonable assumptions) and a coupon rate of 12% on high-yield bonds, the break-even yield would have been 17.33% (Exhibit 16).
Since the break-even yield is earned only on that part of the portfolio which does not default (1 - [D.sub.f]), the formula for calculating break-even yields (BEY) is: [Mathematical Expression Omitted]
"The challenge for the casino, since the casino does subsidize a lot of this travel is to make sure they get a break-even yield
on people playing.
At current costs, the break-even yield
for fungicide and its application allows for economical use of fungicides in commercial maize in South Africa.
For example, a farmer can evaluate which crops to plant for maximum profit and how changes in crop prices would influence income, cash flow, and break-even yields
. Even equipment purchases can be figured in.
We then compared these potential yields with "break-even yields
" that we estimated using data on costs of conversion and drainage, costs of production, and expected market prices for barley, corn, cotton, oats, rice, sorghum, soybeans, and wheat.