MATH 246 Quiz: Quiz 5 Solutions Spring 2011
14 Mar 2019
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The answers on this exam are entirely my own work. I neither gave nor received any aid while taking this exam. You have 85 minutes to take this exam. Please remember to write your name legibly on every page. This exam will be graded out of 100 points. The number in parentheses for each question is the amount of points assigned to the question. The exam has seven questions and 13 pages, including this page. Finance companies are firms that lend money to people and companies. Finance co. has 1000 zero-coupon, one-year loans outstanding, each for a face amount of. Goldfish co. has 10 zero-coupon, one-year loans outstanding, each for million. The face amounts of all the loans are due to be paid one year from today. Each loan has the same probability of default. Each loan has the same rate of loss in the event of default.
