1.Assume that a firm holds a bond with a duration of 5 years and a price of $2,000. The market interest rates associated with this bond currently stand at 8%. Recent forecasts show that the interest rates may rise to 9%. Calculate the percentage change that is expected to occur in the market value of the bond.

2.

Prime banks interest-sensitive assets have a value of $300, and its interest-sensitive liabilities are worth $250. Calculate the interest-sensitive ratio of the bank.

3.

A long Put option with a strike price of R12 and a premium of R2 will break even at:

4.

You write one MBI July 120 call contract (equaling 100 shares) for a premium of $4. You hold the option until the expiration date, when MBI stock sells for $122 per share. You will realize a ________ on the investment.