Which of the following would have the highest liquidity risk? A Treasury bill. A 50 foot...
- Which of the following would have the highest liquidity risk?
- A Treasury bill.
- A 50 foot yacht.
- A 30 year AAA rated Bond with 5 years remaining until maturity.
- 60 day Fed Funds.
Homework Answers
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Correct answer is option : B) A 50 foot yacht.
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Which of the following would have the highest liquidity risk?
A Treasury bill.
A 50 foot...
Answer the next 3 questions based on the following information: Assume that3-month Treasury bill are yielding...
Answer the next 3 questions based on the following information: Assume that3-month Treasury bill are yielding 1.4%, 10-year Treasury bonds are yielding 2.8%, an Aaa-rated 10-year corporate bond is 5%, and real risk-free rate is 1%. 18) What is the inflation risk premium for 3-month Treasury b ill? (Hint: the inte rest rate of 3-month Treasury bill is a proxy for risk-free rate) A) 1.8% B) 1.4% C) 1% D) 0.4% 19) What is the maturity risk premium for 10-year...
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4.Which of the following statements is (are) correct?(x)A 2-year Treasury security has a higher liquidity risk...
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Expert home / study / business/finance / finance questions and answers / a the real risk-free...
Expert home / study / business/finance / finance questions and answers / a the real risk-free rate of interest, r*, is 3%, and it i And Question: A. The real risk-free rate of interest, r*, is 3%; and i A. The real risk-free rate of interest, r*. is 3%; and it is expected to remain constant over time. Inflation is expected to be 3% per year for the next 3 years and 4% per year for the next 5 years....
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QUESTION ONE A 91 days treasury bill with a par value of K100 has been issued...
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Answer the next 3 questions based on the following information: Assume that3-month Treasury bill are yielding 1.4%, 10-year Treasury bonds are yielding 2.8%, an Aaa-rated 10-year corporate bond is 5%, and real risk-free rate is 1%. 18) What is the inflation risk premium for 3-month Treasury b ill? (Hint: the inte rest rate of 3-month Treasury bill is a proxy for risk-free rate) A) 1.8% B) 1.4% C) 1% D) 0.4% 19) What is the maturity risk premium for 10-year...
Expert home / study / business/finance / finance questions and answers / a the real risk-free rate of interest, r*, is 3%, and it i And Question: A. The real risk-free rate of interest, r*, is 3%; and i A. The real risk-free rate of interest, r*. is 3%; and it is expected to remain constant over time. Inflation is expected to be 3% per year for the next 3 years and 4% per year for the next 5 years....
QUESTION ONE A 91 days treasury bill with a par value of K100 has been issued at a price of K97.55. Required: (a) Calculate the bond equivalent yield of the Treasury bill. (b) If the Treasury bill above was a 182 instrument, would the bond equivalent yield be more than or less than the bond equivalent yield calculated above? A 273 Treasury bill with a par value of K100.00 has a bond equivalent yield of 12.75%, which would be achieved...
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