A European bond paying annual coupons of 6% offers a yield of 10% pa.
Convert the yield into an effective monthly rate, an effective annual rate and an effective daily rate. Assume that there are 365 days in a year.
All answers are given in the same order:
### r_\text{eff, monthly} , r_\text{eff, yearly} , r_\text{eff, daily} ###
If a project's net present value (NPV) is zero, then its internal rate of return (IRR) will be:
Question 278 inflation, real and nominal returns and cash flows
Imagine that the interest rate on your savings account was 1% per year and inflation was 2% per year.
Which of the following statements about short-selling is NOT true?
Some financially minded people insist on a prenuptial agreement before committing to marry their partner. This agreement states how the couple's assets should be divided in case they divorce. Prenuptial agreements are designed to give the richer partner more of the couples' assets if they divorce, thus maximising the richer partner's:
The below screenshot of Microsoft's (MSFT) details were taken from the Google Finance website on 28 Nov 2014. Some information has been deliberately blanked out.
What was MSFT's market capitalisation of equity?
An investor bought a 10 year 2.5% pa fixed coupon government bond priced at par. The face value is $100. Coupons are paid semi-annually and the next one is in 6 months.
Six months later, just after the coupon at that time was paid, yields suddenly and unexpectedly fell to 2% pa. Note that all yields above are given as APR's compounding semi-annually.
What was the bond investors' historical total return over that first 6 month period, given as an effective semi-annual rate?
In February a company sold one December 40,000 pound (about 18 metric tons) lean hog futures contract. It closed out its position in May.
The spot price was $0.68 per pound in February. The December futures price was $0.70 per pound when the trader entered into the contract in February, $0.60 when he closed out his position in May, and $0.55 when the contract matured in December.
What was the total profit?
Question 873 Sharpe ratio, Treynor ratio, Jensens alpha, SML, CAPM
Which of the following statements is NOT correct? Fairly-priced assets should:
Question 894 balance of payments, current account, no explanation
Below are four graphs of Australia's external position, published in the RBA's chart pack.
Assume that all assets and liabilities are debt which makes interest income and equity which makes dividend income.
Which of the following statements is NOT correct? As at the end of 2017, Australia’s: