"04-03Fixed Income

"04-03Fixed Income - April 2, 2010 MGMT411:...

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April 2, 2010 MGMT411: Checklist for Special Topics I: Fixed Income 1 - Basic concept + terminology + types of bonds - How to price a bond (same discount rate for all coupon payments + face value; different discount rates for coupon payments + face value) - Concept + computation of various rates/yields (you will not be asked to actually compute the YTM; however, you may be given the YTM and asked to use it to (for instance) compute the price of a bond) - Relation between Prices and YTM - ‘Special’ Bonds - Concept of Default Risk - Yield Curve - Basics on mortgages + financial crisis (I will not ask anything ‘deep.’ Just know roughly what a mortgage/mortgage-backed security/credit-default swap is and what happened in 2008.) - Duration
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April 2, 2010 MGMT411: Practice Problems for Special Topics I: Fixed Income 1 1. Multiple Choice Consider the liquidity preference theory of the term structure of interest rates. According to this theory, investors require _________. A. a higher rate on short term bonds than long term bonds
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"04-03Fixed Income - April 2, 2010 MGMT411:...

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