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QUESTION 3 Clearly explain the features of Fixed Income Securities. Illustrate your response with a relevant example from the Zambian financial markets. [10 Marks] A
QUESTION 3
- Clearly explain the features of Fixed Income Securities. Illustrate your response with a relevant example from the Zambian financial markets.
[10 Marks]
- A 364 Days Treasury bill of K1,000 Face Value is currently on offer at K840.33.
- Calculate its Yield to maturity (YTM) at this price.
[03 Marks]
- Assuming the market yields for similar Bills were 200 basis points higher and lower, calculate the trading price of the bill under each case.
[03 Marks]
- Briefly comment on the relationship between the price of the Bill and its YTM exhibited above.
[04 Marks]
Total 20 Marks
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Business Analysis And Valuation Using Financial Statements Text And Cases
Authors: Krishna G. Palepu, Paul M. Healy, Victor L Bernard
3rd Edition
0324118945, 9780324118940
