Mathematics For Machine Technology
8th Edition
ISBN: 9781337798310
Author: Peterson, John.
Publisher: Cengage Learning,
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Chapter 73, Problem 4AR
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The name of sides with reference to
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Drapers' Bank offers loans and deposits with interest rate 5% compounded monthly.
(a)
If you deposit £5,000 in a Drapers' Bank account, how much money will be in your account 4 years from now? Enter your answer correct to the
nearest pound.
Answer:
(b) What is the effective interest rate of a Drapers' Bank account? Enter your answer as a percentage correct to 3 significant digits.
Answer:
(c)
Drapers' Bank gives you a loan of £60,000 to start a new company under the condition that you pay back the loan in monthly instalments of EC to
be paid at the end of each month over the next 5 years, starting at the end of this month. Determine the value of C and enter it correct to the nearest pound.
Answer:
The Mason group has a liability of £200,000 to be paid in 14 years' time. It wants to Redington immunise these liabilities with assets consisting of amount P in
a bank and Q 18-year zero coupon bonds, with P and Q to be determined. Interest is compounded monthly at rate 8%.
(a)
Answer:
What is the present value of the liability? Enter your answer correct to the nearest pound.
(b) What is the duration of the liability? Enter your answer correct to 3 significant digits.
Answer:
(c) What is the convexity of the liability? Enter your answer correct to 3 significant digits.
Answer:
(d)
Write down the two equations that P and Q need to satisfy for Redington immunisation to hold and solve these equations for P and Q. Enter the
answers correct to the nearest pound.
Answers: P=
Q=
(e) What is the convexity of the assets in this case? Enter your answer correct to 3 significant digits.
Answer:
(f)
Is the convexity condition that is necessary for Redington immunisation satisfied in this case?…
Chapter 73 Solutions
Mathematics For Machine Technology
Ch. 73 - With reference 1, name the sides of each of the...Ch. 73 - With reference to 1, name the sides of each of the...Ch. 73 - Prob. 3ARCh. 73 - Prob. 4ARCh. 73 - Prob. 5ARCh. 73 - Prob. 6ARCh. 73 - Prob. 7ARCh. 73 - Prob. 8ARCh. 73 - Prob. 9ARCh. 73 - Prob. 10AR
Ch. 73 - Prob. 11ARCh. 73 - Prob. 12ARCh. 73 - Determine the values A in degrees and minutes that...Ch. 73 - Determine the values A in degrees and minutes that...Ch. 73 - Determine the values A in degrees and minutes that...Ch. 73 - Determine the values A in degrees and minutes that...Ch. 73 - Determine the values A in degrees and minutes that...Ch. 73 - Determine the values A in degrees and minutes that...Ch. 73 - Determine the values A in decimal degree to 2...Ch. 73 - Determine the values A in decimal degree to 2...Ch. 73 - Determine the values A in decimal degree to 2...Ch. 73 - For each of the following functions of angles,...Ch. 73 - For each of the following functions of angles,...Ch. 73 - For each of the following functions of angles,...Ch. 73 - For each of the following functions of angles,...Ch. 73 - Solve the following exercises. Compute angles to...Ch. 73 - Solve the following exercises. Compute angles to...Ch. 73 - Solve the following exercises. Compute angles to...Ch. 73 - Prob. 29ARCh. 73 - Prob. 30ARCh. 73 - Prob. 31ARCh. 73 - Solve the following applied right triangle...Ch. 73 - Solve the following applied right triangle...Ch. 73 - Solve the following applied right triangle...Ch. 73 - Solve the following applied right triangle...Ch. 73 - Solve the following applied right triangle...Ch. 73 - Solve the following applied right triangle...Ch. 73 - Solve the following applied right triangle...Ch. 73 - Solve the following applied right triangle...Ch. 73 - Prob. 40ARCh. 73 - Prob. 41ARCh. 73 - Prob. 42ARCh. 73 - Prob. 43ARCh. 73 - Prob. 44ARCh. 73 - Prob. 45ARCh. 73 - Prob. 46ARCh. 73 - Prob. 47ARCh. 73 - Prob. 48ARCh. 73 - Prob. 49ARCh. 73 - Determine the sine, cosine, tangent, cotangent,...Ch. 73 - Determine the sine, cosine, tangent, cotangent,...Ch. 73 - Prob. 52ARCh. 73 - Prob. 53ARCh. 73 - Determine the sine, cosine, tangent, cotangent,...Ch. 73 - Prob. 55ARCh. 73 - Prob. 56AR
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