1) A $100 deposit today that earns an annual interest rate of 10% is worth how much at the end of two years? Assume all interest received at the end of the first year is reinvested the second year. 2) An investment of $100 today is worth $116.64 at the end of two years if it earns an annual interest rate of 8%. How much interest is earned in the first year and how much in the second year of this investment? 3) Which of the following investments has a larger future value? A $100 investment
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ACCRUAL SWAPS AND RANGE NOTES PATRICK S. HAGAN BLOOMBERG LP 499 PARK AVENUE NEW YORK‚ NY 10022 PHAGAN1@BLOOMBERG.NET 212-893-4231 Abstract. Here we present the standard methodology for pricing accrual swaps‚ range notes‚ and callable accrual swaps and range notes. Key words. range notes‚ time swaps‚ accrual notes 1. Introduction. 1.1. Notation. In our notation today is always t = 0‚ and (1.1a) D(T ) = today’s discount factor for maturity T. For any date t in the future‚ let Z(t; T ) be the
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What is the rule of 72? Well… here’s the equation: Years to double = 72 / Interest rate DO NOT reread this equation. The rule of 72 is a hard rule to explain. I will do my best to try to explain it. The answer to ‘rule of 72’ gives us a number of years. This number of years tells us how long it takes to double our money. Let’s say you have 100 dollar. The ‘rule of 72’ helps us figure out how long it will take to have 200 dollars. Scenario 1: You have invested your 100 dollars in a 3%
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bond in August for a period of 6 months. Zero-coupon bond of similar quality is currently yielding 4%‚ a cost‚ which the treasurer finds acceptabl(e) The treasurer is of the view that interest rate will rise before the company will issue the debt‚ hence will increase the cost of debt. So to hedge the interest rate risk the treasurer decided to hedge the risk using September Eurodollar futures contract. September 90-day Eurodollar futures contracts are currently trading at 96.25. You are required
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conditioning and negative reinforcement. He developed the “cumulative recorder‚” which showed rates of responding as a sloped line. Using this device‚ he
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Hello everyone‚ this is (YOUR NAME) here with the (X – 1st‚ 2nd‚ 3rd…) entry in the company review interview in my new blog series here on YOURWEBSITE.com. I’m here with (INTERVIEWEE NAME) a partner in XYZ COMPANY. So since you’re here looking for more information about this company‚ this interview is going to provide you with an insider’s perspective of XYZ COMPANY and also give you further information about XYZ COMPANY so you can make an educated decision about joining the XYZ COMPANY. So let’s
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Credit Default Swaps Credit default swaps are the transfer of third party credit risk from one party to the other party. The purchaser of the swap must make the payments until it reaches the maturity date of the assigned contract. A better understanding of CDS is “One party in the swap is a lender and faces credit risk from a third party‚ and the counterparty in the credit default swap agrees to insure this risk in exchange of regular periodic payments (essentially an insurance
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Case‚ Fair‚ and Oster: Chapter 7 problem 10 a. More people are employed in Tappania now than at any time in the past 50 years b. The unemployment rate in Tappania is higher now than it has been in 50 years. Can both of those statements be true at the same time? Briefly explain in four sentences or less. (5 points) The unemployment rate measures the percentage of the labor force that is unemployed. If the increase in the unemployed is higher that the increase in labor force‚ that is‚ the
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Part I – Relation between BI rate and banks interest rate A. BI rate We take the BI rate‚ as the variable being estimated‚ from the period of 2006 until 2012. We then take the average rate in each year‚ rather than taking the rate in each month. As a note to the year 2012‚ we take the average rate that ranges only from January until August. Figure 1. BI rate (Percent per Annum) Source : Indonesian Financial Statistics‚ Bank of Indonesia‚ http://www.bi.go.id/web/en/Statistik/Statistik+
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B.F. Skinner: His Life‚ Methods‚ and Effects on Psychology B.F. Skinner is perhaps one of the most influential and important figures in the field of psychology. His theories and methods have been taught and applied to psychological practice even to the present day. My goal in this paper is to illustrate Skinner’s contribution to psychology by explaining the following: 1. Skinner’s biography and psychological beginnings. 2. Skinner’s belief that human beings are devoid of free will. 3
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