What is duration of bond and what is factoring

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Reference no: EM132072312

1. During a one year period, the inflation rate was 5%. During the same year, you invested in Treasury bills and earned 7% return. You are in a 25% tax bracket.

A. Considering all factors, on the net you earned a rate of return of 2% in excess of the inflation rate

B. Considering all factors, on the net you earned a rate of return of 0.25% in excess of the inflation rate

C. Considering all factors, on the net you earned a rate of return of 1.75% in excess of the inflation rate

D. Considering all factors, on the net you earned a rate of return of 3.25%% less than the inflation rate

E. None of the above

2. What is duration of bond? Why is it important?

3. What is factoring? Why do companies factor?

Reference no: EM132072312

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