If the 3 year forward interest rate calculated from Expectation Theory is 8%, then the...
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Accounting
If the 3 year forward interest rate calculated from Expectation Theory is 8%, then the true expected rate for Year 3 today should be ______ 8%.
- A. Greater than
- B. lower than
- C. Equal to
Which of the following bonds might have a conversion factor of .87?
- A. 7% coupon bond
- B. 6% coupon bond
- C. 8% coupon bond
- D. 8.7% coupon bond
- E. 5% coupon bond
Assume interest rate stays constant. The duration of a 10 year fixed rate coupon bond should ____ as it approaches maturity.
- A. drop
- B. rise
- C. stay the same
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