For each of the following pairs of Treasury securities (each with $ 1 comma 000 par value), identify which will have the higher price: a. A three-year zero-coupon bond or a five-year zero-coupon bond? b. A three-year zero-coupon bond or a three-year 4 % coupon bond? c. A two-year 5 % coupon bond or a two-year 6 % coupon bond?

Step-by-step explanation:

A. The three-year zero coupon bond, because the future value is receiver sooner, thus the present value is higher.

B. The three year 4% coupon bond because it pays interest payments, whereas the zero coupon bond is pure discount bond.

C. The 6% coupon bond because the coupon (interest) payments are higher.

85.560%

step-by-step explanation:

conditional probability is defined as:

p(a|b) = p(a∩b) / p(b)

in other words, the probability that a occurs, given that b has occurred = the probability that both a and b occur / the probability that b occurs.

in this example:

p(turns 64 | turns 44) = p(turns 64 & turns 44) / p(turns 44).

if someone turns 64, they must have already turned 44, so:

p(turns 64 | turns 44) = p(turns 64) / p(turns 44)

on page 42, we see that of the original 100,000, 94944 turn 44, and 81234 turn 64.   therefore:

p(turns 64 | turns 44) = 81234 / 94944

p(turns 64 | turns 44) = 0.85560

b) k’(6, 4); l’(3, 3)

step-by-step explanation:

a 270° clockwise rotation maps every point (x, y) to (y, -x). (it negates the x-coordinate and then switches it and the y-coordinate.)

this means the endpoints of the side congruent to kl, k' and l', would be mapped as:

k'(-4, 6)→(6, 4)

l'(-3, 3)→(3, 3)