Business, 21.02.2020 05:10 Honeyswish7730

A 8-year maturity zero-coupon bond selling at a yield to maturity of 9% (effective annual yield) has convexity of 155.1 and modified duration of 7.06 years. A 30-year maturity 5% coupon bond making annual coupon payments also selling at a yield to maturity of 9% has nearly identical duration—7.04 years—but considerably higher convexity of 244.8.a. Suppose the yield to maturity on both bonds increases to 10%. What will be the actual percentage capital loss/gain on each bond? What percentage capital loss/gain would be predicted by the duration-with-convexity rule? (Input all amounts as positive values. Do not round intermediate calculations. Round your answers to 2 decimal places. Omit the "%" sign in your response.)b. Suppose the yield to maturity on both bonds decreases to 8%. What will be the actual percentage capital loss/gain on each bond? What percentage capital loss/gain would be predicted by the duration-with-convexity rule? (Input all amounts as positive values. Do not round intermediate calculations. Round your answers to 2 decimal places. Omit the "%" sign in your response.)

Answers: 2

Show answers

Another question on Business

Business, 21.06.2019 17:00

The typical consumer's food basket in the base year 2015 is as follows: 30 chickens at $4 each 10 hams at $5 each 10 steaks at $8 each a chicken feed shortage causes the price of chickens to rise to $5.00 each in the year 2016. hams rise to $7.00 each, and the price of steaks is unchanged. a. calculate the change in the "cost-of-eating" index between 2015 and 2016. year cost of the basket 2015 $ 2016 $ instructions: enter your responses rounded to one decimal place. the official cost-of-eating index has by %. b. suppose that consumers are completely indifferent between two chickens and one ham. for this example, how large is the substitution bias in the official "cost-of-eating" index? the in the cost-of-eating index is %. the of inflation in the cost of eating reflects substitution bias.

Answers: 3

Answer

Business, 21.06.2019 17:30

Following are the transactions for valdez services. the company paid $2,000 cash for payment on a 6-month-old account payable for office supplies. the company paid $1,200 cash for the just completed two-week salary of the receptionist. the company paid $39,000 cash for equipment purchased. the company paid $800 cash for this month’s utilities. the company paid $4,500 cash in dividends to the owner (sole shareholder). examine the above transactions and identify those that create expenses for valdez services. prepare general journal entries to record those transactions that created expenses in the above given order.

Answers: 2

Answer

Business, 22.06.2019 23:00

Type of deposit reserve requirementcheckable deposits $7.8 - 48.3 million 3%over $48.3 million 10noncheckable personal savings and time deposits 0refer to the accompanying table. if a bank has $60 million in savings deposits and $40 million in checkable deposits, then its required reserves are$1.2 million.

Answers: 1

Answer

Business, 23.06.2019 01:50

Which term best describes the statement given below? if p = q and q = r, then p = r

Answers: 1

Answer

You know the right answer?

A 8-year maturity zero-coupon bond selling at a yield to maturity of 9% (effective annual yield) has...

Questions