Question
1. Chloe holds a two-year TIPS bond with a $5000 real par value, and a 1% real coupon. Inflation is 5% the first year and
1. Chloe holds a two-year TIPS bond with a $5000 real par value, and a 1% real coupon. Inflation is 5% the first year and 3% the second year. What will be her nominal payment in the second year? Choose the nearest answer. A 5460 B 5200 C. 5050 D. 5300
2. A zero-coupon bond costs $9700 now pays off $10,000 in 18 months. What is its annual yield to maturity? A. 3% B5% C 2% D 1%
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Multinational Business Finance
Authors: David K. Eiteman, Arthur I. Stonehill, Michael H. Moffett
11th Edition
0321357965, 978-0321357960
