SOCIOL 182 Lecture Notes - Lecture 10: United States Treasury Security
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A man invests , 000 in an account that pays 8. 5% interest per year, compounded quarterly. Find monthly compounded interest rate if holding period return (hpr) over one year and a half is 17%x(1+0. 17) =x(1+rmontly/12)^18. You are saving up for a new ducati. May"s fund has had returns of 4% in 2004, 11% in 2005, 8% in 2006, and 7% in 2007. 1 = 7. 471%. the best would be arithmetic average. (1. 09*1. 16*1. 03*1. 02)^. 25 -1= 7. 357% so the first fund is better. Treasury bill yields are very low these days; often below a tenth of a percent. Treasury bill quote below from september 8, 2009. Calculate the bid-ask spread in dollars for a. Assume the expected returns to holding gold are equal to the inflation rate plus 2%. 50%. (i +. 02)x(1-. 50)=8% 0. 5i x 0. 01=8% 0. 5i=0. 08-0. 01 0. 5i/0. 5=0. 07/0. 5 i= 0. 14: a margin account is used to buy 200 shares on margin at per share.
