Investment Science Chapter 5 Solutions to Suggested Problems
Dr. James A. Tzitzouris <[email protected]>
5.1 Project 1 2 3 4 5 Benet-Cost Ratio 2 5/3 3/2 4/3 5/3
So, the approximate method based on cost-benet ratios implies projects 1, 2, and 5 would be r
Investment Science Chapter 7 Solutions to Suggested Problems
Dr. James A. Tzitzouris <[email protected]>
7.1 (a) r = 0.07 +
0.230.07 0.32
= 0.07 +
2
(b) i. = 0.64, ii. Solve 0.07w + 0.23(1 w) = 0.39, yielding w = 1. Hence, borrow $1000 at the risk-free
Investment Science Chapter 12 Solutions to Suggested Problems
Dr. James A. Tzitzouris <[email protected]> 12.1 The initial cost of the spread is nonnegative since C(K1) C(K2) for K1 < K2 (see 12.4). 12.2 Use the same portfolio as in the text: 1. buy one c
Investment Science Chapter 6 Solutions to Suggested Problems
Dr. James A. Tzitzouris <[email protected]>
6.1 The money invested is X0 . The money received at the end of a year is X0 X1 + X0 . Hence, R= 2X 0 X 1 . X0
6.3 For solution method, see solution t
Investment Science Chapter 11 Solutions to Suggested Problems
Dr. James A. Tzitzouris <[email protected]> 11.1 We are given that
S 0 = $ 100, = 0.12, = 0.20, t = 0.25,
so that
u = e t =1.105, 1 d = =0.905, u 1 1 p= t = 0.65, 2 2
and the binomial lattice i
Investment Science Chapter 10 Solutions to Suggested Problems
Dr. James A. Tzitzouris <[email protected]> 10.1 We are given that S = $412, M = 3 (quarters), and r = 9% (compounded quarterly). The storage cost is $2 per ounce per year, so ck = $0.50 for ea
Investment Science Chapter 3
Dr. James A. Tzitzouris <[email protected]>
3.1 Use A= 1 rP
1 (1+r )n
with r = 7/12 = 0.58%, P = $25, 000, and n = 7 12 = 84, to obtain A = $377.32. 3.2 Observe that since the net present value of X is P , the cash ow stream a
Investment Science Chapter 2
Dr. James A. Tzitzouris <[email protected]>
2.1 (a) ($1)(1.033)227 = $1, 587.70 (b) ($1)(1.066)227 = $1, 999, 300.00 2.2 We are given that (1+r)n = 2, so that taking the log of both sides, we have n ln (1 + r) = ln 2 0.69. Usi
EE204B EE204B Electromagnetics Electromagnetics
Lesson Lesson 12 Electrostatic Boundary-Value Problems Resistance and Capacitance, and and Method of Images
Instructor: Prof. Yong H. Won
Lesson 12
Topics
Electrostatic Boundary-Value Problems (Chap. 6)
Res
EE 204B Due 10:00am, Monday Mar 3, 2010
Homework #3
Spring 2010 yhw
Total 8 problems
1. Solve problem 3.6 (Sadiku, International 4th Ed.) Solve problem 3.9 (Sadiku, International 4th Ed.) Solve problem 3.10 (Sadiku, International 4th Ed.)
2.
3.
4.
5.
-1-
Duration and Portfolio Immunization
Macaulay duration
The duration of a fixed income instrument is a weighted average of the times that payments (cash flows) are made. The weighting coefficients are the present values of the individual cash flows.
PV (t0
Investment Science Chapter 13 Solutions to Suggested Problems
Dr. James A. Tzitzouris <[email protected]> 13.1 The equation is best implemented on a computer. The answer for the call stated in the exercise is C = $2.57. 13.2 (a) For the expression P(S) =