Gains and losses are recognized daily IMR = $2,530, MMR = $2,300, for a T-Bond futures $100,000. Suppose you buy one June contract at the open of $98,500, Monday’s settle price is 98’10, and Tuesday’s close is 97’00. What is in your margin call in Tuesday’s settle

Q: Assume newly issued 30-year-on-the-run bonds sell at lower yields (higher prices) than 29 ½ year…

A: Bond Hedging is a process of buying or selling of bonds on the basis of their yields and duration to…

Q: Your liabilities consist of $60,000 coming due in one year and $40,000 coming due in three years.…

A: Liability due in one year is $60,000 Liability due in three years is $40,000 The market interest…

Q: Vcast Inc., is expected to grow at a constant rate of 6 percent will pay a dividend of $2.75 next…

A: The current stock worth can be derived as the discounted value of future cash flows from the stock.…

Q: Due to the heavy demand for the LNG (Liquefied Natural Gas) tankers, the Hyunda Shipyard has…

A: The internal rate of return (IRR) refers to the real rate of return expected from the project. The…

Q: Albert obliged to pay his liability to PWONG Multipurpose Cooperative amounting to Php450,000.00…

A:

Q: N4    Explain in very details the Discounting rate approaches:   1) Top-down Approach   2)…

A: These discounting rate approaches are used to analyze and choose securities and are also used…

Q: According to the CAPM, a stock with a high standard deviation must have a beta ________ that of a…

A: Risk means uncertainty and potential loss for the decision, and because of that, there might be a…

Q: Find the future value of a four-year investment of $2,570 that earns 4% compounded quarterly.

A: FV = P * (1 + r/n) ^ ntWhere FV = Future ValueP = Principal = $2,570R = Rate on interest = 4%T =…

Q: Beckham Corporation has semiannual bonds outstanding with nine years to maturity that are currently…

A: A bond is a type of debt security. Borrowers, such as businesses or governments, issue bonds to…

Q: A project has a 70% chance of producing a 10% return and a 30% chance of generating -4% returns.…

A: The expected return is calculated with the help of following formula  Expected Return = Return ×…

Q: Let's assume you borrowed $2000 from Wells Fargo Bank on July 1. The annual Percentage Rate is 5%.…

A: The periodic payment is payments made to repay the loan or debt. The periodic payment is made at…

Q: Find the depreciation for the indicated year using MACRS cost-recovery rates for the properties…

A: Depreciation for a 3 year property in the 3rd year = Value of property*Depreciation rate in the 3rd…

Q: What is the beta of your portfolio? (Do not round intermediate calculations and round your final…

A: Beta is a measure of systematic risk. Beta of a portfolio is the weighted average of betas of…

Q: Consider a $100 levered mutual fund that will liquidate in 5 years. The funds capital structure…

A: Market value The value at which a financial asset is sold in the market is called the market value…

Q: The goal is to compute a price for Tesla, Inc Some information about Tesla - The market price of…

A: Value of Tesla using P/E multiples is calculated by finding mediam of predicted P/E and then…

Q: The Table below lists expected returns on 8 different Research & Development (R&D) projects that a…

A: Cost of capital that is the rate at which company can borrow money from market is very important and…

Q: A machine costs $100,000 and generates $25,000 of pre-tax operating income per year.  The tax rate…

A: The NPV of an asset is used to measure its profitability by discounting the future cash flows to…

Q: Please solve ASAP with formulas/explanation. Provide an arbitrage trading strategy as well. Will…

A: Arbitrage opportunity exists due to different prices in different markets and hence risk free profit…

Q: What is the monthly payment size of a 25-year mortgage for $100 000 and an interest rate of 6%…

A: A mortgage is a loan that is paid off in equal monthly installments. Each installment comprises…

Q: Describe the three sufficient conditions required for consistent IRR and NPV rankings for one-time…

A: Introduction The three sufficient conditions required for consistent IRR and NPV rankings of…

Q: Use the information below to calculate WACC given the Market Capitalization of       the company:…

A: Free Cash Flow (FCF) of the firm is calculated using EBIT. Value of a firm is the present value of…

Q: Consider a bond at par initially issued for a 30-year term. Its nominal rate (annual coupon) is 5%.…

A: Bonds are securities with fixed coupon payments and redemption at par on maturity. This phenomenon…

Q: The ABC has just paid a dividend of $5. The dividends are expected to grow at a rate of 20% for the…

A: The dividend Just paid is $5 The growth rate of dividends for three years is 20% The constant…

Q: Powerade will invest $50 million in a project that will be funded completely by debt initially.…

A: The FTE technique is a method of valuation that accounts for all payments to and from debt holders…

Q: Concerns about bank solvency has been used to justify product segmentation on the grounds of   A)…

A: Bank generally offers a large variety of products to its customers. It is a tailor made strategy to…

Q: Consider alternatives A and B as shown below. The interest rate is 9%. For parts a) and b), let X =…

A: concept. payback period is the time required to recover initial investment. In case of uniform…

Q: The BIG company with a 15.3 percent cost of equity is acquiring a competitor, which will increase…

A: CAPM refers to the model that describes the relationship between a company’s expected returns and…

Q: that an analyst has looked at a random sample of 50 companies in the S&P 500 to understand the…

A: Standard Error is standard deviation or an estimate of standard deviation of a sample used for…

Q: Question 6 Peter started to deposit PhP5,000 quarterly in a fund that pays 1% compounded quarterly.…

A: formula. Future value of annuity = PMT * [(1+r)n - 1]r where , PMT = periodic deposit r= interest…

Q: Ford has a 5 year $100m fixed rate loan with Citibank at 0.061 (annual rate). Ford now thinks rates…

A: The value of the loan is 100m. The loan period is 5 years. The fixed rate on the loan is 0.061.…

Q: What is the NPV of the following cash flows if the required rate of return is 0.09? Year        0…

A: Required rate of return = 0.09 Year Cash flow 0 -6816 1 3577 2 3505 3 2732 4 3757

Q: Kobe has a mortgage for $798,337.00. The term of the mortgage is 4 years, and the amortization…

A: Loan amortization is the process of making equal payments over the life of the loan. These regular…

Q: A $10,000, five-year bond redeemable at par and bearing interest at 6.5% payable semi-annually is…

A: The cash price of the bond, also referred to as the dirty price, is the price of the bond that…

Q: Compare Sweden's H&M and Spain's Inditex/Zara marketshares of their home country marke grow in its…

A: Sweden Market share Spain Market share

Q: You are an investor and notice a diversified portfolio, D from the table below. Suppose you use a…

A: Arbitrage is a method of buying any stock or security on one exchange and selling that security on…

Q: a b C d e Sinking Fund Payment Payment Period every 6 months every year every 3 months every month…

A: A loan is a financial arrangement in which one or more people, companies, or other entities lend…

Q: Four alternatives (Alternatives A, B, C, and D) described below are being evaluated. Incremental…

A: A capital project or alternative is selected if it adds value to the company. It adds value to the…

Q: Suppose that the principal of a synthetic CDO is $125 million. The equity, mezzanine, and senior…

A: Suppose that the principal of a synthetic CDO is $125 million.   The equity, mezzanine, and senior…

Q: BRT Ltd's financial statements show the following figures: Sales revenue $233.45 million . Net…

A: In the given case, Net income is given . So, if number of outstanding shares are given , then the…

Q: 2. You have two investment accounts. Account #1 started at $700 at 6.8% compounded monthly. Account…

A: 700 Investment

Q: which of the following is not part of dupont analysis  options are net profit margin sales…

A: The Du Pont analysis is an extended method of computing the return on Equity. It helps in…

Q: 10. There is a risky portfolio of multiple stocks with an expected return of 14% and a standard…

A: To find risk-adjusted relative return Sharpe ratio is considered to be the best method. This is…

Q: a b C d e Amortization Payment Payment Period every year every 3 months every month every 6 months…

A: The amortized payment can be calculated using the present value of loan, payment frequency and…

Q: A stock has a correlation with the market of 0.4. If the Sharpe ratio of the market portfolio is…

A: The correlation of the market is 0.4. The Sharpe ratio of the market portfolio is 0.7

Q: Which of the following statements is correct? A. a. Since accounts payable and accruals must…

A: Additional funds needed refers to the concept of finance which is used for the expansion of its…

Q: under which scenario EVA will be increased  optons are decrease in the captital employed decresae…

A: Economic Value Added The value generated by a company from the amount of money invested is known as…

Q: Solve the problem using the information given in the table and the weighted-average inventory…

A: Number of Units Sold 67 units Date of Purchase Units Cost per unit Beginning Inventory 25…

Q: eeds to accumulate Php460,000.00 for her insurance investment for 2 1/2 years. She set up a sinking…

A: Future value of annuity includes the amount that is being deposited and amount of interest…

Q: Profits. What are the profits on the following investments, Investment CD Stock Bond Car Original…

A: Concept. 1. Capital appreciation = selling price of investment - original cost of investment.    2.…

Q: 20,000

A: Spot price = 2500 / 1000 KG  The future of stock palm oil is 1000 kg lot.   Take it is being sold…

Treasury Market

On-the-run securities are the most recently issued securities in the market depth and are therefore traded at some premium. The off-the-run securities are the ones issued just before the most recent ones. The on-the-run securities have a lower yield to the investor than the off-the-run securities.