Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

help me solve these questions! Answer the next 4 questions using the information in the following table. You are considering the purchase of a $1,000

help me solve these questions! image text in transcribed
image text in transcribed
image text in transcribed
Answer the next 4 questions using the information in the following table. You are considering the purchase of a $1,000 par value Treasury Bill and observe the following quotes for T-Bills in the market: Ignore transaction costs. Time to Maturity Bid (days) Asked % 60 1.64 88 1.55 1.63 116 1.54 1.62 144 1.53 1.61 1.52 4. The bid price of a T-bill in the secondary market is A. the price at which the dealer in T-bills is willing to sell the bill. B. the price at which the dealer in T-bills is willing to buy the bill. C. larger than the asked price of the T-bill. D. The price at which the investor can buy the T-bill. 5. What is the purchase price of the 144-day bill that you face? A. $993.29 B. $993.92 C. $994.05 D. $993.56 4 6. What would be the effective annual rate of return on your investment if you held the bill until maturity? A. 1.56% B. 1.65% C. 1.54% D. 1.72% 7. What would be the effective annual rate of return on your investment if you bought this bill today and were able to sell it back to a dealer after 28 days, assuming that yields do not change over time? A. 1.61% B. 0.38% C. 1.13% D. 1.52% t dividend of Multicrowth Inc. 15 $1.. The company is expected to grow ranidlv for ars at 30%, at the end of which time the new growth rate is expected to be a constant 8% a year. The required rate of return is 15%. What is the intrinsic value of the firm? A. $39.21 B. $39.50 C. $38.68 D. $39.59 10. Consider the following short sale example: an investor borrows 100 shares of a stock from the broker, put down 50% as the initial margin, and sells the stock at $100/share in the market. Suppose the stock price later goes up from $100/share to $150/share, put a _may limit the potential loss for the investor. A. limit sell order at $120/share B. limit buy order at $120/share C. stop buy order at $120/share D. stop loss order at $120/share

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Carbon Markets Or Climate Finance?

Authors: Axel Michaelowa

1st Edition

0415743435, 978-0415743433

More Books

Students also viewed these Finance questions

Question

=+How do your consumption behaviors reflect your personal identity?

Answered: 1 week ago