The deterministic (non-simulation) approach, using best guesses for the uncertain inputs, is:
a. better to use in complicated real world applications
b. a good estimate of what the answer will be using a simulation approach
c. generally not the appropriate model
d. the preferred approach when there is correlation between input variables
c
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Amortized premium is computed annually when a bond is issued for other than its face value. For a bond issued at a premium, how will this component change as the bond approaches maturity?
a. decrease b. increase c. remain constant d. not enough information given to decide
What is the difference between disconfirming and confirming communication?
What will be an ideal response?
Kenya earns a biweekly salary of $575 plus 13.5% commission on net sales over $1,500. Her total sales in the past week were $1,968.00 with $105.00 in returned sales. Her total sales the week before were $2,245.91 with $256.90 in returned sales. What is Kenya's gross earnings for the two-week period?
A) $892.52 B) $568.88 C) $362.31 D) $317.52
Which of the following statements is CORRECT?
A. If a coupon bond is selling at a discount, its price will continue to decline until it reaches its par value at maturity. B. If interest rates increase, the price of a 10-year coupon bond will decline by a greater percentage than the price of a 10-year zero coupon bond. C. If a bond's yield to maturity exceeds its annual coupon, then the bond will trade at a premium. D. If a coupon bond is selling at a premium, its current yield equals its yield to maturity. E. If a coupon bond is selling at par, its current yield equals its yield to maturity.