Version A Concordia University Department of Economics ECON 331 Section B Winter 2013 MIDTERM EXAM Name: ______________ Student ID: _____________________________ Mark: ___________________/70 marks Instructor: Faisal Rabby Feb. 28‚ 2013 Time Limit: 70 minutes MULTIPLE CHOICE: Circle the one alternative that best completes the statement or answers the question. (2x15 =30 points) 1) Which of the following can be described as involving indirect finance? A) People buy shares of a mutual fund
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INTRODUCTION This introductory chapter will focus on the fundamental features of bond‚ the type of issuers‚ and risk faced by investors in fixed-income securities. Bond A bond is a debt instrument requiring the issuer to repay to the lender the amount borrowed plus interest over a specified period of time. A typical (plain vanilla) bond issued in the United States specifies A fixed date when the amount borrowed (the principal) is due‚ called the maturity date. The contractual amount of interest
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TS FEED APPENDICES ONLINE AND BATCH FEEDS FOR AIM & TOMS March 3‚ 2011 Version: 1.62 ii Table of Contents Appendix 1: Security Identifier Flag Codes ..................................................................... 1 Appendix 2: Series or Exchange Codes ......................................................................... 2 Appendix 3: Future Exchange Codes ............................................................................. 8 Appendix 4: Record Type .........................
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issues. Answers to Questions: 1. Calculate the APY for each of Johnson & Johnson’s bonds and identify which one has the lowest APY‚ assuming today is January 15‚ 2009. Answer: Bond 1‚ calculate the APY of the 7.375s23 eurobond. There are 15 coupon payments left‚ and the last one was made 2 months plus 6 days ago (66 days ago). Use annual payment analysis; CPN=7.375% x 1000 = $73.75. Solve the equation using a spreadsheet with N=15‚ and f=(66/360)=0.183333 to find the APY = 7.3001%: |[pic]
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BOND PROBLEM SOLUTIONS 1. Six years ago‚ The Corzine Company sold a 20-year bond issue with a 14 percent annual coupon rate and a 9 percent call premium. Today‚ Corzine called the bonds. The bonds originally were sold at their face value of $1‚000. Compute the realized rate of return for investors who purchased the bonds when they were issued and who surrender them today in exchange for the call price. PV = 1000; N = 6; PMT = 140; FV = 1090; CPT I/Y I/Y = 15.02% 2. You just purchased
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May 14‚ 2009 Executive Summary From: Team A Consulting Requestor: Yvonne Reynolds‚ Director of Store Operations Date: April 13‚ 2010 Locations: Main Office Subject: Service Request SR-kf-001 Generate Monthly Newsletter with Coupons In the world of upscale specialty foods‚ Kudler Fine Foods is one of the leaders in the San Diego metropolitan area. Capable of providing the finest foodstuffs‚ wines‚ and specialty foods as well as attention to detail and customer satisfaction
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Chapter 08 The Efficient Market Hypothesis Answer Key M ultiple Choice Questions 1. Which of the following beliefs would not preclude charting as a method of portfolio management? A. The market is strong-form efficient. B. The market is semistrong-form efficient. C. The market is weak-form efficient. D. Stock prices follow recurring patterns. 2. In a 1953 study of stock prices
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Answers of Managerial Economics Homework #2 Chapter 5~Chapter 9 1.Using figure 5.3 as a basis‚ construct a series of four figures to show the effect of an increase in the demand for tanker service on the market price when (a) demand is extremely inelastic‚ (b) demand is extremely elastic‚ (c) supply is extremely inelastic‚ and (d) supply is extremely elastic. Answer: [pic] [pic] [pic] [pic] 2.Industry researchers R.S. Platou predicted
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Bond Practice Problems II 1. Seven years ago your firm issued $1‚000 par value bonds paying a 7% semi-annual coupon with 15 years to maturity. The bonds were originally issued at par value. a. What was the original yield to maturity on the bonds? They were issued at par…so the YTM = Coupon rate: 7% b. If the current price of the bonds is $875‚ what is the yield to maturity of the bonds TODAY? 1000 FV .07(1000)÷2= PMT (15-7)*2 = N -875 PV I/Y = 4.623*2 = 9.25% c. If the yield
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basis) does an investor earn on the Treasury bill for the 90-day period? The cash price of the Treasury bill is The annualized continuously compounded return is Problem 6.9. It is May 5‚ 2010. The quoted price of a government bond with a 12% coupon that matures on July 27‚ 2014‚ is 110-17. What is the cash price? The number of days between January 27‚ 2010 and May 5‚ 2010 is 98. The number of days between January 27‚ 2010 and July 27‚ 2010 is 181. The accrued interest is therefore The quoted
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