PLEASE ANSWER ALL QUESTIONS FOR THUMBS UP

1)

On September 9, 2016, the Wall Street Journal reported that the overnight federal funds rate was 0.42%. What is the bond equivalent rate for federal funds?

	a.	2.28%
	b.	4.26%
	c.	0.43%
	d.	2.79%

2)

What is the duration of a three-year, $1,000 Treasury note with a 12% semiannual coupon selling with a yield to maturity of 8%?

	a.	2.56
	b.	2.48
	c.	2.77
	d.	2.63

3)

An individual desires to earn a real return of 1%. Prices are expected to rise over the investment period by 4%. The investor has a federal tax rate of 25% and state and local tax rate of 6%, what is the investor's expected after tax rate of return?

	a.	4.14%
	b.	4.62%
	c.	5.08%
	d.	3.45%

4) What is the duration of a bond that pays zero coupons and has 10 years to maturity?

	a.	12 years
	b.	8 years
	c.	6 years
	d.	10 years

5)

You can buy commercial paper of a major U.S. corporation for $995,235. The commercial paper has a face value of $1,000,000 and is 125 days from maturity. What is the discount yield on the commercial paper?

	a.	8.23%
	b.	8.41%
	c.	1.37%
	d.	1.56%

6)

You expect to hold a bond with $1,000 face value for three years and then sell it for $1,050. The bond pays semi-annual interest at an annual rate of 8% and is currently selling for $1,020. What is the expected rate of return on the bond?

	a.	7.96%
	b.	6.83%
	c.	8.72%
	d.	9.31%