Suppose you buy a put option on a $100,000 Treasury bond futures contract with an exercise price of $100,000 for a premium of $1500. If on expiration the futures contract has a price of $99,000, what is your profit or loss on the contract?

What is the zero rate with continuous compounding : The annual continuously compounded 6-month and 1-year zero rates are 3% and 4%, respectively. A 1.5-year bond that pays coupons of $2 every six months currently sells for $98.52. What is the 1.5-year zero rate with continuous compounding? |

The annual continuously compounded : The annual continuously compounded 6-month and 1-year zero rates are 3% and 4%, respectively. A 1.5-year bond that pays coupons of $2 every six months currently sells for $98.52. What is the 1.5-year zero rate with continuous compounding? Show the ca.. |

What is the minimum investment yield the company requires : An insurance company’s projected loss ratio is 80 percent and its loss adjustment expense ratio is 18 percent and the dividend ratio is 3 percent. What is the minimum investment yield the company requires to earn a 4% profit? |

Insurance company ask this person to pay for the annuity : Suppose a 60-year-old person wants to purchase an annuity from an insurance company that would pay $50,000 per year until the end of that person’s life. The insurance company expects that this person would live for 25 more years and it would be willi.. |

Treasury bond futures contract with an exercise price : Suppose you buy a put option on a $100,000 Treasury bond futures contract with an exercise price of $100,000 for a premium of $1500. If on expiration the futures contract has a price of $99,000, what is your profit or loss on the contract? |

Maintain a sustainable growth rate : Fulkerson Manufacturing wishes to maintain a sustainable growth rate of 9.5 percent a year, a debt-equity ratio of .49, and a dividend payout ratio of 28 percent. The ratio of total assets to sales is constant at 1.26. Required: What profit margin mu.. |

Explain how marketing is both a reflection of a culture : Explain how marketing is both a reflection of a culture and a powerful influence upon it. Explain with the help of suitable examples. What is business portfolio analysis? Discuss how a company might use the Boston Consulting Group's (BCG) growth-mark.. |

What must be the spot exchange rate : If interest parity holds and the interest rate in the U.K. is 6 percent, the interest rate in the US is 4.5 percent, and the one-year forward exchange rate is 1.75 dollars per British pound, what must be the spot exchange rate? Is the U.S. dollar exp.. |

What is the interest expense in dollars : US Bank has purchased a 7 million one-year Canadian dollar loan that pays 8.5% interest annually. The spot rate of U.S. dollars for Canadian dollars is 0.70. What is the deposit amount in Euros? What is the interest expense in dollars? |

## Retirement account has a fixed rateYour retirement account has a fixed rate of 8% per year paid yearly. You start saving for retirement at age 30 with a target retirement age of 65 and $0 in your savings account. Set up and solve a suitable first order differential equation to answer .. |

## What will be the value of the investment in two yearsYour brother has asked you to help him with choosing an investment. He has $6,000 to invest today for a period of two years. You identify a bank CD that pays an interest rate of 0.0300 annually with the interest being paid quarterly. What will be the.. |

## What is your effective borrowing rate nowYour firm needs to raise $100 million in funds. You can borrow short-term at a spread of 1% over LIBOR. Alternatively, you can issue 10-year, fixed-rate bonds at a spread of 2.50% over 10-year treasuries, which currently yield 7.60%. Current 10-year .. |

## Compare and contrast online brokerage to dips and dripsSearch the Web for three companies (look for investor information) that offer DIPs or DRIPs and compare and contrast the requirements, including minimum investments, nature of the return, costs, and other features. |

## Should christians charge poor people interest on loansDo you think the interest on payday loans is too high or just right? Should Christians charge poor people interest on loans? |

## What must the coupon rate be on the bondsEssary Enterprises has bonds on the market making annual payments, with eleven years to maturity, a par value of $1,000, and selling for $958. At this price, the bonds yield 6.4 percent. What must the coupon rate be on the bonds? |

## Other metrics relative to standard benchmarkMost sources report alphas and other metrics relative to a standard benchmark, such as the S&P 500. When might this method be an inappropriate comparison? |

## Efficient market hypothesis-is the stock market efficientThe finance industry is in the midst of a transformative period of evolution, and financial economists have a huge agenda to tackle. Capital Marketing Theory and the Efficient Market Hypothesis are two common concepts used to describe the relationshi.. |

## Equation best describes the evolutionSuppose the following equation best describes the evolution of B over time: Bt=.30+.70Bt-1 If a stock had a B of 0.82 last year, what would you forecast the B to be in the coming year? |

## Assuming market efficiencyAssuming market efficiency: What is the efficient market hypothesis? If XYZ Corporation’s stock is expected to fall next year to $45 and the closing price was $60 yesterday, what would be the price today if the annual equilibrium return is 10%? |

## What is the value of rolens preferred stockSeveral years ago, Rolen Riders issued preferred stock with a stated annual dividend of 8% of its $100 par value. Preferred stock of this type currently yields 7%. Assume dividends are paid annually. What is the value of Rolen's preferred stock? Roun.. |

## Present value years interest rate future valueFor each of the following, compute the present value (Do not include the dollar signs ($). Enter rounded answers as directed, but do not use the rounded numbers in intermediate calculations |

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