Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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6. The prices of 1, 2, 3, and 4-year zero coupon government bonds are 95.42, 90.36, 85.16, and
78.81, respectively. What is the continuously compounded 3-year zero rate?
A. 6.40%
B. 6.12%
C. 5.07%
D. 5.35%
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Transcribed Image Text:6. The prices of 1, 2, 3, and 4-year zero coupon government bonds are 95.42, 90.36, 85.16, and 78.81, respectively. What is the continuously compounded 3-year zero rate? A. 6.40% B. 6.12% C. 5.07% D. 5.35%
Finance Department
7. On November 1, 2020 a trader took a long position in three futures contracts on a commodity
that expires on March 31", 2021. The initial futures price is $60. On December 31, 2020 the
futures price is $61. On Feb 28, 2021 it is $64. The contract is closed out on February 28, 2021
What gain is recognized in the accounting year from January 1 to December 31, 2020? Each
contract is on 1000 units of the commodity and the transaction qualities to be considered as a
hedge.
A. $0
B. $3,000
C. $9,000
D. $12,000
expand button
Transcribed Image Text:Finance Department 7. On November 1, 2020 a trader took a long position in three futures contracts on a commodity that expires on March 31", 2021. The initial futures price is $60. On December 31, 2020 the futures price is $61. On Feb 28, 2021 it is $64. The contract is closed out on February 28, 2021 What gain is recognized in the accounting year from January 1 to December 31, 2020? Each contract is on 1000 units of the commodity and the transaction qualities to be considered as a hedge. A. $0 B. $3,000 C. $9,000 D. $12,000
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