The queen is able to convince the king not to execute the knight, and instead offers punishment herself. What question must the knight answer to avoid losing his head in one year?

In what way does the knight struggle to find the answer?

The lady continues to suggest that her poverty is a virtue . What does she reference as evidence of this in lines 1177 – 1182?

A bond pays annual interest. Its coupon rate is 7.4%. Its value at maturity is $1,000. It matures in 4 years. Its yield to maturity is currently 4.4%. The duration of this bond is __________ years.

Out of all of her husbands, which is/was the wife’s favorite?

A portfolio with a 22% standard deviation generated a return of 17% last year when T-bills were paying 6.0%. This portfolio had a Sharpe ratio of __________.

You have a 25-year maturity, 10.8% coupon, 10.8% yield bond with a duration of 10 years and a convexity of 136.3. If the interest rate were to fall 133 basis points, your predicted new price for the bond (including convexity) is __________. (Select the closest answer.)

The lady lectures the knight on his arrogance and unkindness to her. Though she was “low-born” like a peasant and he was of higher class as a knight, what does she suggest makes someone of lower class? (Lines 1165 – 1176)

Assuming semiannual compounding, a 15-year zero coupon bond with a par value of $1,000 and a required return of 12.2% would be priced at __________.

A pension fund has an average duration of its liabilities equal to 15 years. The fund is looking at 6-year maturity zero-coupon bonds and 5% yield perpetuities to immunize its interest rate risk. How much of its portfolio should it allocate to the zero-coupon bonds to immunize if there are no other assets funding the plan?