HW2_Ans - the bond with the highest return, which bond...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
NAME: ________________________________ EC370 – Fall 2008 HW2 Answer KEY Write your answers to the multiple choice questions in the appropriate space using CAPITAL LETTERS. 1) D 9) A 17) D 2) B 10) B 18) A 3) B 11) A 19) B 4) C 12) D 20) B 5) C 13) D 21) C 6) C 14) C 22) B 7) C 15) D 23) A 8) A 16) C 24) D 25) Assume bonds A and B are identical in terms of risk and you are trying to determine which bond to purchase. If you hold until maturity and are only interested in purchasing
Background image of page 1
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: the bond with the highest return, which bond would you rather buy? You would rather buy the bond with the lower (8%) coupon – Bond A 26) Report your findings for the yield to maturity for each bond (in percentage terms): YTM Bond A: 13.797% YTM Bond B: 7.108% 27) Are the results from the IRR function the same as those using the Goal Seek method? YES....
View Full Document

This note was uploaded on 10/17/2009 for the course EC 370 taught by Professor Staff during the Spring '08 term at University of Oregon.

Ask a homework question - tutors are online