finance data bank

Question # 00004223 Posted By: spqr Updated on: 11/28/2013 12:22 AM Due on: 12/28/2013
Subject Finance Topic Finance Tutorials:
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1. Using the information and risk free rate found in #5, what would the yield of a 30-day corporate bond be?

2. 4-year corporate securities are currently yielding 5.8%. You know the following are the current interest rate premiums. Calculate the inflation premium.



3

Interest rates on 4-year Treasury securities are currently 7%, while interest rates on 6-year Treasury securities are currently 7.5%. If the pure expectations hypothesis is correct, what does the market believe that 2-year securities will be yielding 4 years from now?

4. Interest rates on 3-year treasury securities are currently 8%, while 6-year treasury securities are 8.5%. If pure expectations hypothesis is correct, what does the market believe that 3-year securities will be yielding 3 years from now?

5

One-year Treasury securities yield 4.78%. The market anticipates that 1 year from now, 1-year Treasury securities will yield 5.29%. If the pure expectation theory is correct, what should be the yield today for 2-year Treasury securities?

6

3-year treasury securities beginning two years from now are expected to yield 5.75%, whereas a 2-year Treasury security is currently yielding 5%. A 2-year security is expected to yield 6.2% beginning 3 years from now. What is the yield for a 3-year treasury security beginning today?

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  1. Tutorial # 00004017 Posted By: spqr Posted on: 11/28/2013 12:29 AM
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