Other
INV2601 - Assessment 2 S2 2022
- Course
- Institution
100% pass rate
[Show more]
Seller
Follow
Monnas123
Reviews received
Content preview
TRUSTED100% PASS RATE
, Question 1
According to the liquidity preference theory, which of the following statements is least
accurate?
a.
All else equal, investors prefer short-term securities over long-term securities.
b.
Investors perceive little risk differential between short-term and long-term securities.
c.
Borrowers will pay a premium for long-term funds to avoid having to roll over short-
term. debt.
d.
Investors always prefer the higher liquidity of short-term bonds and any deviance from
an upward sloping yield curve is only temporary.
Question 2
Question text
Consider a 30 year, R1 000 semi-annual-pay bond with a 9% coupon and a 13.20% yield
to maturity. Based on a change in the yield to maturity of 1.20%, the effective duration of
the bond is closest to:
a.
3.84
b.
4.55
c.
7.67
d.
9.10
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller Monnas123. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $5.67. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
67866 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now