1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
sdas [7]
3 years ago
11

A manager is holding a $4.0 million bond portfolio with a modified duration of eight years. She would like to hedge the risk of

the portfolio by short-selling Treasury bonds. The modified duration of T-bonds is 10 years. How many dollars' worth of T-bonds should she sell to minimize the risk of her position
Business
1 answer:
Luda [366]3 years ago
8 0

Answer:

$3,200,000

Explanation:

Duration of bond portfolio (Dp) = 8

Value of bond portfolio (Vp) = 4,000,000

Duration of bonds (Df) = 10

T-bonds to be sold = Dp * Vp / Df

T-bonds to be sold = 8 * 4,000,000 / 10

T-bonds to be sold = $3,200,000

You might be interested in
If competition places discipline on costs, motivating firms to innovate and find more cost-effective ways to produce, which of t
Cloud [144]

Answer:

The answers are economies of scale, natural monopolies, and lowered average fixed cost.

Explanation:

The explanations for some firms beahvior in determined markets are economies of scale, natural monopolies, and lowered average fixed cost.

3 0
3 years ago
Which of the following is NOT a determinant of a shift in demand for Laptops?
lora16 [44]
It's a income i did that quiz
4 0
3 years ago
Read 2 more answers
An investor is in a 30% combined federal plus state tax bracket. If corporate bonds offer 8.75% yields, what yield must municipa
Lilit [14]

Answer:

6.125%

Explanation:

Calculation for what yield must municipals offer for the investor to prefer them to corporate bonds

The after-tax yield on the corporate bonds is: 8.75% x (1 - 0.30)

The after-tax yield on the corporate bonds is= 0.0875x 0.7

The after-tax yield on the corporate bonds is= 0.06125*100

The after-tax yield on the corporate bonds is= 6.125%

Therefore what yield must municipals offer for the investor to prefer them to corporate bonds is

6.125%

8 0
3 years ago
Type the correct answer in the box. Spell all words correctly. Henry works at a newspaper agency. Here, he works with the editor
stepladder [879]

Answer:

Henry works at a newspaper agency. Here, he works with the editor to put fresh stories in the newspaper every day. This is necessary because, as each day passes, that day’s newspaper becomes old and redundant. Which quality of the newspaper is depicted here? The quality of the newspaper is highly depicted here.

Explanation:

There was nothing incorrect but i felt that being would be better if it was replaced with is

8 0
4 years ago
When you construct the replicating portfolio for the option in the previous question how many dollars do you need to invest in t
netineya [11]

Answer: The same amount of dollars

When it comes to the financial level, a replicating portfolio as the name implies, is a repetition of specific flows of a given asset, so it must be constituted with the same resources. In this case, the same amount of cash would be needed to create the replica.

4 0
3 years ago
Other questions:
  • BE22-4 Gundy Company expects to produce 1,200,000 units of Product XX in 2017. Monthly production is expected to range from 80,0
    15·1 answer
  • Federal express has a(n) ________________ in logistics and customer service, since these are activities it does especially well
    13·1 answer
  • At the beginning of 2018, Rex Co. showed a debit balance in the cash account of $20,500. Total debits to this account during the
    15·1 answer
  • An economics system in which consumers vote with their dollars to answer what is produced and how it is produced is known as ___
    13·2 answers
  • Ken pays $4803.60 for a 3-year annuity of $2,000 per year. What is the Internal Rate of Return?
    9·1 answer
  • A company is preparing its cash budget for the coming month. All sales are on account. Given the following: Beginning Balances B
    10·1 answer
  • Suppose a consumer had a budget of $125. The price of Good X is $5 and the price of Good Y is $7.50. Calculate value of the x-in
    14·1 answer
  • The following information was available from the inventory records of Sheffield Corp. for January: Units Unit Cost Total Cost Ba
    15·1 answer
  • makes their first monthly payment (including principal and interest), what amount will they record into their interest expense a
    5·1 answer
  • The Public Company Accounting Oversight Board (PCAOB) has authority to establish which of the following relating to public compa
    6·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!