which one is correct please confirm? Q20: Which investment would show the highest rate of return: 1) a six month (180/360 days) deposit at a rate of 4.75% or 2) a six month straight discount bill at a discount rate of 4.60% (180/360)     "A six month deposit is a true

Q: Find the equivalent of present worth (t = 0) of a uniform series of $4550 for 8 years, if the…

A: Present Worth calculates the current value of future cash flows or a series of payments, typically…

Q: Consider Southeastern Homecare. Which of the following is the better choice for the risk-free rate…

A: The risk-free rate refers to the hypothetical rate of return on an investment that carries zero…

Q: An investment is expected to result in equal payments of $3160.00 at the end of each of the next 5…

A: The question is based on the application of the time value of money for annuity payments.  Annuity…

Q: Which option yields a higher return? Option A: $50 in 6 months and $50 in 12 months, assuming a…

A: Here,Option A:$50 in 6 Months (n1)$50 in 12 months (n2)Interest Rate (r) is 3%Compounding Period (m)…

Q: You plan to invest $1,000 for one year and you have the opportunity to invest it at a 12 percent…

A: Hi There, Thanks for posting the questions. As per our Q&A guidelines, must be answered only one…

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A: The yield on the the treasury bills are considered to be the risk because they are issued by federal…

Q: n interest rate is 12% APR when measured using semiannual compounding. What is the equivalent rate…

A: Effective rate is the rate after considering the impact of compounding on the interest rate.

Q: %

A: a) The modified duration can be calculated as:   Modified Duration = Duration / (1 + Yield)   Given…

Q: Suppose that at the present time, one can enter 5-year swaps that exchange SOFR for 8%. An off-…

A: Number of years: 5SOFR: 8%Coupon rate to be received: 11%Notional principal: $20 million

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A: Dear student, kindly check the answer in the explanation box below.Explanation:Dear student, below…

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A: Interest Rate = r = 15%Payment for year 1 = p1 = $1100Payment for year 2 = p2 = $1230Payment for…

Q: You are paying a series of five constant-dollar (or real-dollar) uniform payments of $664.85…

A: The formula used for the computation is:

Q: Let's imagine that the OIS rates for one year and two years are 2% and 4% respectively. Now, let's…

A: Dear student, kindly check the answer in the explanation box below.Explanation:Part 1: Answer:The…

Q: Consider a contract that caps the LIBOR interest rate on $10,000 at 8% per annum (with quarterly…

A: The London Interbank Offer Rate, written as LIBOR, is the global reference rate for unsecured…

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A: A plain vanilla swap pertains to an interest rate swap in which a floating interest rate is…

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A: Present Value refers to the discounted value of a single cash flow or multiple cash flows today…

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A: Approach to solving the question:Please see attached photos for detailed solutions. Thank you.…

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A: Variables in the question:Rate for 2 year=6.4%Rate for 1 year=5.4%Formula to be used:Expected one…

Q: Consider a 6-month futures contract on a financial asset with dividend yield q=3.96% per year. Risk…

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Q: Which of the following investments that pay will $9,500 in 14 years will have a lower price today?…

A: The objective of the question is to determine which of the two investments, one earning an interest…

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A: Strike price = $0.50premium = $0.02Future spot rateProbability$0.4620%$0.4830%$0.5250%

Q: A 330-day T-Bill is currently selling at a discount rate of 3.97%. What will be the price of the…

A: The below expression can be used to calculate the current price of T-bill:

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A: The pure expectation explains the yield curve in terms of the expected short term rates.

Q: The spot rate: USD 1.21/EUR 2-year USD YTM=0.11% 2-year EUR YTM= -0.72%. Suppose that you invest…

A: Spot rate = $1.21 per EuroSpot rate in 2 years = $1 per Euro2-year $ interest rate = 0.11%2-year…

Treasury Market

On-the-run securities are the most recently issued securities in the market depth and are therefore traded at some premium. The off-the-run securities are the ones issued just before the most recent ones. The on-the-run securities have a lower yield to the investor than the off-the-run securities.