2. Determine the price of each of the following Treasurys. Par value is $100. US Treasurys...
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2. Determine the price of each of the following Treasurys. Par value is $100. US Treasurys COUPON (6) YIELD (8) 3.875 4.21% D 5.37% 10-Year Note 1 Year Bill How much of the 10-year note's price is due to the coupon payment? After one year how much interest will an investor earn from the 1-year bill if it was bought at today's price? 3. A couple bought a $250.000 home with 10% down and a 15-year annual mortgage rate of 6.9%. What are their monthly payments? How much do they owe on the loan after five years of payments? Create a data table with the amount owed on the loan after five years as the output variable. The column input is the monthly payment. Start with $1500 and go to $2400 in increments of $300. Report your results. What is the table telling you? 4. Determine the future value of the following cashflows at the end of year 4 if the interest rate is 7%. Time (years) cashflow 0 $100 1 $100 2 $200 3 $200 $300 At the end of year 5, the value in the account is $1,010 while still earning 7%. What was the cashflow during year 5? Was it an inflow or an outflow? Explain. 2. Determine the price of each of the following Treasurys. Par value is $100. US Treasurys COUPON (6) YIELD (8) 3.875 4.21% D 5.37% 10-Year Note 1 Year Bill How much of the 10-year note's price is due to the coupon payment? After one year how much interest will an investor earn from the 1-year bill if it was bought at today's price? 3. A couple bought a $250.000 home with 10% down and a 15-year annual mortgage rate of 6.9%. What are their monthly payments? How much do they owe on the loan after five years of payments? Create a data table with the amount owed on the loan after five years as the output variable. The column input is the monthly payment. Start with $1500 and go to $2400 in increments of $300. Report your results. What is the table telling you? 4. Determine the future value of the following cashflows at the end of year 4 if the interest rate is 7%. Time (years) cashflow 0 $100 1 $100 2 $200 3 $200 $300 At the end of year 5, the value in the account is $1,010 while still earning 7%. What was the cashflow during year 5? Was it an inflow or an outflow? Explain.
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Treasury Pricing and Analysis 2 Treasury Pricing 10Year Note Par value 100 Coupon rate 3875 Yield 421 1Year Bill Par value 100 Yield 537 Calculating t... View the full answer
Related Book For
Fixed Income Securities Valuation Risk and Risk Management
ISBN: 978-0470109106
1st edition
Authors: Pietro Veronesi
Posted Date:
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