Hedge Fund You are a bond analyst working for a hedge fund. A bond you follow has face value 100, has a coupon rate of 5% (paid once a year) and matures in 5 years. You are trying to find if there is any profitable trading strategy. You’ve done extensive research and have formed your opinions on future economic conditions. As a result, you expect that there will soon be a major shift in the yield curve. The current and the expected yield curve is shown below:
Year Current Expected
1 1% 3.00%
2 1.50% 2.50%
3 2.00% 3.50%
4 3.00% 4.00%
5 5.00% 5.00%

Question 1/3

Calculate the price of the bond based on the current yield curve? (use 2 decimal digits)
incorrect

Question 2/3

Calculate the price of the bond based on the expected yield curve $ (keep two decimal points)

Question 3/3

You are 100% sure about your expectation of the movement of the yield curve in the near future. And you want to set up a trading position before the market price in the future shift of yield curve. What should you do?
Buy the bond
Sell the bond
Do nothing

Fill in the missing words to correctly complete each sentence about analyzing a job posting. when reviewing a job posting, it’s important to check theto determine whether it’s worth your time to apply. if the post has been up for a while or it’s already closed, move on to the next position. if it’s still available, take note of when it closes so you’ll know when you mayfrom the company in regard to an interview.

Connors academy reported inventory in the 2017 year-end balance sheet, using the fifo method, as $154,000. in 2018, the company decided to change its inventory method to lifo. if the company had used the lifo method in 2017, the company estimates that ending inventory would have been in the range $130,000-$135,000. what adjustment would connors make for this change in inventory method?

Shrieves casting company is considering adding a new line to its product mix, and the capital budgeting analysis is being conducted by sidney johnson, a recently graduated mba. the production line would be set up in unused space in the main plant. the machinery’s invoice price would be approximately $200,000, another $10,000 in shipping charges would be required, and it would cost an additional $30,000 to install the equipment. the machinery has an economic life of 4 years, and shrieves has obtained a special tax ruling that places the equipment in the macrs 3-year class. the machinery is expected to have a salvage value of $25,000 after 4 years of use. the new line would generate incremental sales of 1,250 units per year for 4 years at an incremental cost of $100 per unit in the first year, excluding depreciation. each unit can be sold for $200 in the first year. the sales price and cost are both expected to increase by 3% per year due to inflation. further, to handle the new line, the firm’s net working capital would have to increase by an amount equal to 12% of sales revenues. the firm’s tax rate is 40%, and its overall weighted average cost of capital, which is the risk-adjusted cost of capital for an average project (r), is 10%. define “incremental cash flow.” (1) should you subtract interest expense or dividends when calculating project cash flow?