Workforce diversity includes differences in areas such as race, ethnicity, gender, religion, education, & socioeconomic status.

A manager assigns an employee responsibility for completing a project & gives the employee the authority needed to make decisions related to the project. This is an example of:

Every small business is considered an entrepreneurial venture because it is independently owned.

An HR manager identifies a position’s duties, responsibilities, required knowledge, skills, & qualifications. This process is:

Entrepreneurial ventures generally pursue opportunities through innovation, growth, & profitability.

You are working on the interest rate derivatives desk of a large investment bank. A corporate client is negotiating an interest rate swap to lock in fixed funding for its debt. To quote the deal, you need the correct par swap rate, which is the fixed rate that makes the present value of the fixed leg equal to the present value of the floating leg at initiation. Your system provides the following annual discount factors: 1-year discount factor: [df1] 2-year discount factor: [df2] 3-year discount factor: [df3] 4-year discount factor: [df4] 5-year discount factor: [df5] 6-year discount factor: [df6] 7-year discount factor: [df7] 8-year discount factor: [df8] Your manager turns to you and says: “Find the [year]-year par swap rate — the rate that makes the fixed payments exactly equal to par at that maturity.” What is the [year]-year par swap rate?Round your answer to the nearest three decimals if needed. Type your answer in percentage and not in decimals (i.e. 5.2 and not 0.052). Do not type the % symbol.

You are valuing a plain-vanilla bond using the following binomial lattice. You obtained its interest rates through calibration and par rates. Can you estimate the price of the bond? Face Value: $100.00 Spot Rate Today: [z1]% Forward Rate 1-year duration, starting 1-year from today (Node B): [f11b]% Forward Rate 1-year duration, starting 1-year from today (Node C): [f11c]% Coupon Rate: [c]%   *Round your answer to the nearest three decimals if needed. Do not type the $ symbol.

A pension fund manager is analyzing the Treasury yield curve. She has observed the following discount factors: 1-year discount factor: [df1] 2-year discount factor: [df2] 3-year discount factor: [df3] 4-year discount factor: [df4] She wants to compute the [year]-year annualized spot rate. What is the [year]-year spot rate?   Round your answer to the nearest three decimals if needed. Type your answer in percentage and not in decimals (i.e. 5.2 and not 0.052). Do not type the % symbol.

You are working in the treasury department of a multinational energy company. The CFO is considering issuing new corporate bonds to lock in long-term funding, but wants to evaluate whether the firm would be better off rolling short-term debt instead. You are given the following annual spot rates (annual compounding): 1-year spot rate: [spot1]% 2-year spot rate: [spot2]% 3-year spot rate: [spot3]% 4-year spot rate: [spot4]% 5-year spot rate: [spot5]% 6-year spot rate: [spot6]% 7-year spot rate: [spot7]% 8-year spot rate: [spot8]%   The CFO turns to you and says: “We need to know the market’s view on future short-term borrowing costs. Find the [length]-year forward rate starting at year [start] so we can compare rolling loans against issuing longer-term debt today.”   What is the [length]-year forward rate starting at year [start]?   Round your answer to the nearest three decimals if needed. Type your answer in percentage and not in decimals (i.e. 5.2 and not 0.052). Do not type the % symbol.

A regional bank is restructuring part of its balance sheet and decides to issue a 3-year inverse floating-rate note (inverse floater). The coupon resets annually and is linked inversely to short-term interest rates, so investors benefit if rates fall. Analysts value the note using a 3-year binomial interest-rate lattice, calibrated from market par and forward rates.   Bond details Face Value: $100.00 Reset/Payment Frequency: Annual (coupon paid at each year-end) Coupon Formula: Coupon at time t=K−Lt\text{Coupon at time } t = K – L_tCoupon at time t=K−Lt​ where• K=[k]%K = [k]\% is the fixed base rate chosen by the issuer,• LtL_t is the 1-year short rate at the start of each period (from the lattice). Today’s 1-year spot rate: [z1]% 1-year forward rates starting 1 year from today (t=1):• Node B: [f11b]%• Node C: [f11c]% 1-year forward rates starting 2 years from today (t=2):• Node D: [f21d]%• Node E: [f21e]%• Node F: [f21f]% At maturity (t=3), the bond also pays back the principal $100. The fixed rate used to calculate coupons ( e.g., k minus f#,# ) is [k]%.    Task:Using the lattice, estimate the price today by backward induction under equal risk-neutral branch probabilities (0.5). Discount each node’s expected cash flow by the local 1-year short rate at that node.   Hint1: Given your experience at this point of this class, valuation of an inverse floater should be like riding a bike!  Step 1: Keep in mind the calibrated rates are already given to you. No need to calibrate the tree. Step 2: What is my coupon rate? In the case of inverse-floaters, it is simply the base rate (k) minus the interest rate shown on each node of the tree. Hence, you will have a different coupon on each node.  Step 3: Solve the tree backwards (starting from the terminal nodes), as usual.    Hint2: The higher the market (binomial tree) rates, the lower your inverse floater coupon will be. Theoretically, the coupon may be negative if any of the rates in the tree is higher than your base rate. In practice, this is usually avoided by setting a floor at zero (so the coupon cannot be lower than zero).