Which of following describes forward rates?
A) Interest rates implied by current zero rates for future periods of time
B) Interest rate earned on an investment that starts today and last for n-years in the future without coupons
C) The coupon rate that causes a bond price to equal its par (or principal) value
D) A single discount rate that gives the value of a bond equal to its market price when applied to all cash flows
Correct Answer:
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Q1: The modified duration of a bond portfolio
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Q4: The six month and one-year rates are
Q5: The two-year zero rate is 6% and
Q6: Which of the following is NOT a
Q7: The compounding frequency for an interest rate
Q8: Bootstrapping involves
A) Calculating the yield on a
Q9: Under liquidity preference theory,which of the following
Q10: Which of the following is true?
A) When
Q11: The zero curve is upward sloping.Define X
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