Has 7.9 percent coupon bonds on the market with 22 years to maturity. The bonds make semiannual payments and currently sell for 109 percent of par. a. What is the current yield on the bonds? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e. g., 32.16.) b. What is the YTM? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e. g., 32.16.) c. What is the effective annual yield?

The treasurer for pittsburgh iron works wishes to use financial futures to hedge her interest rate exposure. she will sell five treasury futures contracts at $139,000 per contract. it is july and the contracts must be closed out in december of this year. long-term interest rates are currently 7.30 percent. if they increase to 9.50 percent, assume the value of the contracts will go down by 20 percent. also if interest rates do increase by 2.2 percent, assume the firm will have additional interest expense on its business loans and other commitments of $149,000. this expense, of course, will be separate from the futures contracts. a. what will be the profit or loss on the futures contract if interest rates increase to 9.50 percent by december when the contract is closed out

Which of the following statements is (are) true? i. free entry to a perfectly competitive industry results in the industry's firms earning zero economic profit in the long run, except for the most efficient producers, who may earn economic rent. ii. in a perfectly competitive market, long-run equilibrium is characterized by lmc < p < latc. iii. if a competitive industry is in long-run equilibrium, a decrease in demand causes firms to earn negative profit because the market price will fall below average total cost.

Which of the following comes after a period of recession in the business cycle? a. stagflation b. a drought c. a boom d. recovery