Spring 2015
THE CHINESE UNIVERSITY OF HONG KONG
FINA2210 B/C Interest Theory and Finance
Assignment No. 2 (for Chapters 3 and 4)
Deadline: 16 March 2015 (5:00pm Sharp)
1. You are given the following i
Question 2
a. Using a financial calculator, we find that the price of the zerocoupon bond (with
$1000 face value) is:
For yield to maturity of 8%: $374.84
For yield to maturity of 9%: $333.28
The pri
Spring 2015
THE CHINES UNIVERSTY OF HONG ONG K
FINA2210 B/C ters In Theory and Finace
t Asignme No. 5 (for hapterC 8)
Deadlin: 17 April 2015 (5:00pm Sharp)
* hisT is the LAST
t asignme for the course
Fall 2014, FINA2210A Interest Theory and Finance
Chapter 5 Loans and Costs of Borrowing (Amortization and Sinking Fund)
Introduction
This chapter discusses two methods of repaying a loan:
(a) The amo
Chapter 73
A $1,000 par value 10year bond with
redemption value of $1,080 and coupon
rate of 8% payable semiannually is
purchased by an investor at the price of
$980. Find the yield to maturity of th
Learning Objectives 1. Yield to maturity,
yield to call and par yield 2. Realized
compound yield and horizon analysis 3.
Estimation of the yield curve: bootstrap
method
7.1 Some Simple Measures of Bon
Chapter 77
Table 77 illustrates the par yields
computed from two different spotrate
curves: an upward sloping curve and a
downward sloping curve. Table 7.2: Par
yields of two term structures Case 1
C
Chapter 75
Although the Excel Solver can be used to
calculate the solution of equations (7.1)
and (7.2), the computation can be more
easily done using the Excel function
YIELD, the specification of wh
Chapter 78
HoldingPeriod Yield For various
reasons, investors often sell their bonds
before maturity. The holdingperiod
yield, also called the realized compound
yield or the total return, is often
c
Chapter 72
Yield to Maturity Given the yield rate
applicable under the prevailing market
conditions, we can compute the bond
price using one of the pricing formulas in
Chapter 6. In practice, however,
Chapter 74
(a) We need to solve for i in the basic
price formula P = (F r)a nei + Cvn ,
which, on the issue date, is 105.25 =
2a20ei + 100(1 + i) 20 . The numerical
solution of i is 1.69% (per halfye
Chaper 79
Example 79 illustrates that when the
yield rate is unchanged after a bond
investment until it is sold prior to
maturity, the holdingperiod yield in that
period is equal to the yield to matu
Chapter 76
Given the prevailing spotrate curve and
that bonds are priced according to the
existing term structure, the yield to
maturity iY is solved from the following
equation (for an annual coupon
INTEREST RATE MEASUREMENT
5
on January 1, 2004 then he would have interest added to his account at the
close of business on December 31 of 2004 and every December 31 after that
as long as the account
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Instructions
for Assignment Submission
By
Miss Iris Au
This is 2/F of Cheung Yu Tung Building.
Follow the indicated direction.
Then turn right as indicated.
1.
2.
3.
4.
You will find the assignment in
Spring 2017
FINA 2210BC Interest Theory and Finance
Mathematical Preliminaries
Arithmetic Sequence: a, a+d, a+2d, a+3d,
n
2
Sum of an arithmetic series: a (a d ) (a 2d ) . [a (n 1)d ] [2a (n 1)d ] .
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CHAPTER 1
MEASUREMENT OF INTEREST
Study p lp17
1.1 Definitions
Interest may be defined as compensation A paid by
one person (the borrower) for the use of an asset
belonging to another person (the len
EXAM CODE T1
NAME:
STUDENT I.D.:
University of Toronto
ACT 240H1F  TERM TEST 1
12th of October 2007
Instructor  Andrei Badescu
NOTES:
1. Nonprogrammable calculators are allowed.
2. Scrap paper is
FCAC  Publications  Credit Cards and You  Getting the Most from Your Credit Card
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Credit Cards and Yo
SECTION 1  EFFECTIVE RATES OF INTEREST AND DISCOUNT
SECTION 1  EFFECTIVE RATES OF INTEREST AND DISCOUNT
Sections 1.11.2 of "Mathematics of Investment and Credit" (3rd ed.)
Simple interest
At annual
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Chapter 2  PART A:
Basic Annuities
January 3, 2015
Chapter 2 (Part A): Basic Annuities
A. Introduction
1. Denition
An annuity is dened as a series of payments made at equal
intervals of time.
An an