When compared to modified duration, effective duration:

Question 8 options:

is equal to modified duration for callable bonds but not putable bonds.

factors in how embedded options will change expected cash flows

places less weight on recent changes in the bond's ratings

The one-year spot rate is 7.5%. One year forward rates are 8.35% one year from today, 10.60% two years from today, and 12.5% three years from today.

The Value of a 4-year, 11% annual pay, $1000 per bond is closest to: ( please round to 2 decimals)

Question 4 options:

$1,048

$984

$1,052

An interpolated spread (I-spread) for a bond is a yield spread relative to:

Question 5 options:

benchmark spot rates

swap rates

risk-free bond yield