Calculate the duration of a 9% annual coupon bond with 6 years to maturity.  Assume the market interest rate is 7%. Show your work on your hand-written page.  In the space below, write your answer as a percent but do not include the percent sign. For an answer of 8.75 years you would simply write 8.75.

A fixed coupon corporate bond with 30 years to maturity has a price quote of 93.5, with payments made annually.  What coupon rate would a company expect for this bond if you expect the yield to be about 7.5%? (hint – Assume the quote should be used as percentage of par.  You do not need to consider this bond as quoted in 8ths)    * Please show your work clearly on your hand-written page.  Partial credit will be given if I can follow your work. *  

You are a commercial bank lender. Explain the current interest rate environment for banks and explain which type of loans you should want to make for the betterment of your institution.  Discuss the impact of interest rates on the bank balance sheet.   As a bank manager, do you prefer low interest rates or high interest rates?  Explain why.  

You are a commercial bank lender. Explain the current interest rate environment for banks and explain which type of loans you should want to make for the betterment of your institution.  Discuss the impact of interest rates on the bank balance sheet.   As a bank manager, do you prefer low interest rates or high interest rates?  Explain why.  

ABC Corporation just announced a 2-for-1 stock split.  Prior to the split the company had a market value of $3.6 billion with 90 million shares outstanding.  The split conveys no new information about the ABC Corporation. To receive full credit or to earn partial credit, please do your work on the hand-written page.  (Submit with all your hand-written work as the last problem on the exam.)  Prior to the split, what was the price per share of ABC Corporation stock? What is the value of ABC Corporation after the split? How many shares will be outstanding after the split? What will the price per share be after the split?    

Calculate the duration of a 10% annual coupon bond with 5 years to maturity.  Assume the market interest rate is 8%. Show your work on your hand-written page.  In the space below, write your answer as a percent but do not include the percent sign. For an answer of 8.75 years you would simply write 8.75.

FAB-u-less BANK currently has $10 million in deposits and holds $500,000 in excess reserves.  A new customer comes along with a fabulous new deposit of $75,000.  Assuming that the bank policy is to hold a total of 13% of deposits in the form of reserves. Calculate the excess reserve ratio: Calculate the required reserve ratio:  How much would the bank required reserves increase on the new deposit? To receive full credit or to earn partial credit, please do your work on the hand-written page.  (Submit with all your hand-written work as the last problem on the exam.)   

A fixed coupon bond with 20 years to maturity has a coupon rate of 8%, with payments made annually.  What is the price the company would expect to see for this bond if it expects the yield to be 9%? * Draw a timeline of show all cashflows for this bond.  Submit the timeline with your hand-written work. *

The Covid-19 pandemic created considerable concern for the U.S. economy.  Actions were taken by the Federal Reserve during and shortly after the pandemic which dramatically impact the management of financial institutions.  Identify specific actions that were taken in 2020 in regard to: Reserve requirements Open market transactions Interest rates Ge specific with your answers and include the possible downside to each action taken.  

Complete the following loan amortization by hand.  Please draw a table like the one below on your blank page and fill in each blank. You will take a picture of this chart and upload your completed chart at the end of the exam. Please show your work. Please do not forget to calculate the total finance (interest) charge for this loan.  You should enter the total interest (finance) charge in the blank prompt for this question.     You are considering purchasing a house for $285,000.  Do a three month loan amortization and calculate total finance charge.  Assume a 20 % down payment.    20 year 5.00% loan with one and a half discount points.   Beginning Balance Payment Principle Interest Ending Balance                                       FILL IN THE BLANK FOR.    Total finance charge:_____________________