1) How much would an investor lose the first year if she purchased a 30-year zero-coupon bond with a $1,000 par value and a 10% yield to maturity, only to see market interest rates increase to 12% one year later?
2) Suppose you pay $9,600 for a $10,000 Treasury bill maturing in four months. What is the effective annual rate of return for this investment? This is not a TIPS bill, but inflation is 4.5%.
3) You purchased a 5-year annual interest coupon bond one year ago. Its coupon interest rate was 5% and its par value was $1,000. At the time you purchased the bond, the yield to maturity was 4%. If you sold the bond after receiving the first interest payment and the bond's yield to maturity had changed to 3%, your annual total rate of return on holding the bond for that year would have been approximately
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Boone brothers remodels homes and replaces windows. ace builders constructs new homes. if boone brothers considers expanding into new home construction, it should evaluate the expansion project using which one of the following as the required return for the project?
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Which of the following is not a characteristic of a weak economy? a. a low employment rateb. a high inflation ratec. a decreased gdpd. a high unemployment rate
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Abank has $132,000 in excess reserves and the required reserve ratio is 11 percent. this means the bank could have in checkable deposit liabilities and in (total) reserves.
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1) How much would an investor lose the first year if she purchased a 30-year zero-coupon bond with a...
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