Problem 7-16 Using Treasury Quotes [LO2] Locate the Treasury issue in Figure 7.5 maturing in August 2045. Assume a par value of $10,000. a. What is its coupon rate? Note: Enter your answer as a percent rounded to 3 decimal places, e.g., 32.161. b. What is its bid price in dollars? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. c. What was the previous day's asked price in dollars? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. a. Coupon rate b. Bid price c. Previous day's price % FIGURE 7.5 Sample Wall Street Journal U.S. Treasury Note and Bond Prices Treasury Notes and Bonds Asked Maturity Coupon Bid Asked Chg Yield 5/15/2025 2.750 96.150 96.154 -0.006 4.406 7/31/2026 0.625 88.270 88.274 -0.020 4.108 5/15/2027 2.375 93.206 93.212 -0.036 4.010 4/30/2028 1.250 87.142 87.152 -0.064 3.932 1/31/2029 1.750 88.200 88.210 -0.080 3.900 11/15/2030 0.875 80.294 80.304 -0.788 3.727 2/15/2031 1.125 82.170 82.180 -0.102 3.657 5/15/2032 2.875 93.066 93.076 -0.136 3.746 11/15/2032 4.125 102.312 103.002 -0.834 3.753 2/15/2036 4.500 108.180 108.190 -0.910 3.663 2/15/2037 4.750 111.116 111.126 -0.940 3.700 2/15/2038 4.375 106.284 106.294 -0.942 3.729 5/15/2038 4.500 108.084 108.094 -0.946 3.767 8/15/2039 4.500 108.156 108.166 -0.974 3.779 8/15/2040 3.875 100.056 100.066 -0.966 3.858 11/15/2040 1.375 67.042 67.052 -0.210 3.970 2/15/2041 4.750 111.270 111.280 -0.962 3.831 8/15/2041 3.750 97.300 97.310 -0.944 3.905 2/15/2042 3.125 88.290 88.300 -0.920 3.959 5/15/2042 3.000 86.310 87.000 -0.912 3.972 2/15/2043 3.125 88.054 88.064 -0.248 3.986 5/15/2044 3.375 91.040 91.050 -0.274 3.996 8/15/2045 2.875 83.114 83.124 -0.966 4.001 2/15/2046 2.500 77.220 77.230 -0.954 3.989 8/15/2047 2.750 81.052 81.062 -1.000 3.955 11/15/2048 3.375 91.110 91.120 -1.034 3.909 8/15/2049 2.250 73.024 73.034 -1.002 3.884 5/15/2050 1.250 56.144 56.154 -0.946 3.839 2/15/2051 1.875 66.104 66.114 -0.968 3.848 11/15/2052 4.000 103.110 103.130 -1.074 3.807

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QUESTION 9 Use the data in the table shown below. What is the geometric average return over the span of three years? Date 12/31/2018 12/31/2019 12/31/2020 12/31/2021 O a. 28.7% O b.7.5% c.9.5% O d. 8.9% Price $43.00 $45.60 $42.60 $52.50 Dividend $0.80 $0.80 $0.90

Question 32

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[Related to Solved Problem 5.2b] Use the data on Treasury securities in the following table to answer the question: 1 year 0.39% Date 2 year 3 year 03/05/2010 0.88% 1.56% Source: U.S. Department of the Treasury. Assuming that the liquidity premium theory is correct, on March 5, 2010, what did investors expect the interest rate to be on the one-year Treasury bill two years from that date if the term premium on a two-year Treasury note was 0.04% and the term premium on a three-year Treasury note was 0.06%? The expected interest rate is %. (Round your response to two decimal places.)

QUESTION 18 Suppose that the 1-year, 2-year, 3-year, and 4-year spot rates are observed as follows: r1=9.7%, r2=10.2%, r3=10.9%, r4-12.3%, What must be the expected return in year 4 under the liquidity preference theory if the liquidity premium is 0.49%? Oa. 18.63% Ob. 16.61% c. 16.12% Od. 18.14%

Problem 5-16 Value-Weighted Indexes (LO4, CFA2) The following three defense stocks are to be combined into a stock index in January 2019 (perhaps a portfolio manager believes these stocks are an appropriate benchmark for his or her performance). Assume the index is scaled by a factor of 10 million; that is, if the total value of all firms in the market is $5 billion, the index would be quoted as 500. Douglas McDonnell Dynamics General International Rockwell Index value Shares (millions) 210 450 350 2019 return 2020 return 1/1/19 $94 36 65 % % Price a. Calculate the initial value of the index if a value-weighting scheme is used. (Round your answer to 2 decimal places.) 1/1/20 $ 97 31 54 1/1/21 $111 45 68 b. What is the rate of return on this index for the year ending December 31, 2019? For the year ending December 31, 2020? (A negative value should be indicated by a minus sign. Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.)

Only typed answer Suppose that the current 4-year treasury security rate is 5.5 percent and the 1-year treasury rate is 3.75 per­cent. According to the unbiased expectations theory, what should be the 3-year expected rate 1-year from now? Group of answer choices 6.09% 6.39% 5.88% 4.74%

Question 11 Not yet answered What is the current price of a debenture with a $51, 800, 000 face value, a coupon rate of 9.2 % paid semi-annually, 8 years remaining to maturity and a market interest rate of 10.74 %? (Please round your answer to two decimal places). $ Please only use a plain number as your answer and don't insert a comma. For example, if you get 1000, please use 1000, and don't use 1,000.