What conclusions can you draw, Business Management

Assignment Help:

QUESTION

(i) Write short notes on

a. Callable Bonds

b. Yield to Maturity

c. Zero-Coupon Bonds

(ii) Consider a bond with a 12% coupon rate and paying interest semi-annually. The maturity date is March 1, 2013, and the settlement date is July 1, 2011. Assuming that the yield to maturity is 5%, calculate

a. The dirty price,

b. The accrued interest,

c. The clean price.

(iii) Suppose you hold a five-year bond with a par value of $100 and a coupon rate of 5%. Assume that the bond is paid annually and that interest rates are 3% (yield).

a. What is the duration of the bond?

b. What is the duration of the bond if instead the coupon rate was 1%?

c. What is the duration of the bond if instead the coupon rate was 3%?

d. How would your answers in parts (a), (b) and (c) change if you were holding a ten-year bond instead?

e. What conclusions can you draw?


Related Discussions:- What conclusions can you draw

What do you understand by the concept intercultural myths, QUESTION 1 (...

QUESTION 1 (a) What are the three main types of communication processes that have emerged from research and study in the field of human communication? (b) What are the key c

Recent macro developments, In 2006, European economy performed well with an...

In 2006, European economy performed well with an economic growth of 3%, which was the highest since 2000. This is a sign that the economy is on the road to recovery and in fact mos

How is the matrix organisation created, How is the matrix organisation crea...

How is the matrix organisation created? Matrix organization is created through merging (as two complementary structures, as like) pure project organization and also functional

What are the relevant components of an e-business model, Problem 1: (a)...

Problem 1: (a) What are the relevant components of an E-business model? (b) What is an Electronic Payment System? Why is it important? (c) Explain how payment gateway

Eliminates of manufacturing waste, JIT  is a management  philosophy  that  ...

JIT  is a management  philosophy  that  eliminates of manufacturing  waste  by production  the  right part in the right place at the right time. Waste results from any activity tha

What are the functions of the upper middle management, What are the functio...

What are the functions of the upper middle management? Upper middle management: This includes Sales executive (Manager), Finance executive, Production executive and R and

Personnel Management Case Study, Personnel Management Case Study "Adobe Co...

Personnel Management Case Study "Adobe Consulting Services (ACS), a provider of HR software application systems, prides itself on the variety of benefits it offers employees. In a

What is breakeven analysis, What is Breakeven Analysis? Breakeven Ana...

What is Breakeven Analysis? Breakeven Analysis: It implies that at several point in the operations, total revenue equivalents total cost. This analysis is concerned along

Explain how good people management can help an organization, QUESTION T...

QUESTION The Euro crisis will have a major impact on the Mauritian economy. Many businesses in Mauritius depend on European countries for the exportation of their products and

Function of maintenance, The important functions of maintenance can be ...

The important functions of maintenance can be stated as follows: 1. To develop maintenance policies procedures and standards for the organization. 2. To schedule planne

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd