A floating rate bond and an inverse floating rate bond are backed by $100 million portfolio of 10-year bonds. The coupon rate on the inverse floater equals: 12% – 2r. The market value of the portfolio of 10-year bonds rises to $110 million. Assume the credit quality of the portfolio does not change. At the reset date, the value of the inverse floating tranche will:

The price of one-year zero coupon bond is 92.593. The price of a two-year bond with a coupon rate of 7.0 percent is 101.711. Both bonds have a par value of 100 dollars. What is the two-year spot rate (in percent)?  

I promise to adhere to [obey] FIU’s Student Code of Academic Integrity. Violations include:”i. The unauthorized use of any materials, information, study aids or assistance from another person on any academic assignment or exercise, unless explicitly authorized by the course Instructor.ii. Assisting another Student in the unauthorized use of any materials, information, study aids, unless explicitly authorized by the Instructor.iii. Having a substitute complete any academic assignment or completing an academic assignment for someone else, either paid or unpaid.”

A floating rate bond and an inverse floating rate bond are backed by $100 million portfolio of 10-year bonds. The coupon rate on the inverse floater equals: 12% – 2r. The market value of the portfolio of 10-year bonds rises to $105 million. Assume the credit quality of the portfolio does not change. At the reset date, the value of the inverse floating tranche will:

Consider the following basic $100 million CDO structure. The senior tranche has a par value of $70 million dollars and a coupon rate of LIBOR + 1.0%. The mezzanine tranche has a par value of $20 million and a coupon rate equal to 8.25%. The equity tranche has a par value of $10 million. Fees are equal to 5.2% of the equity tranche’s par value. The collateral consists of bonds with a coupon 9.75% that mature in ten years. A ten-year interest rate swap with notional principal of $70 million dollars is available that receives fixed rate of 5.25% and pays the LIBOR. Design a CDO that satisfies the above requirements. What is the potential annual return (in percent)  to the equity tranche assuming no defaults?

A company can invest funds for five years at LIBOR minus 50 basis points. The five-year swap rate is 4%. What fixed rate of interest can the company earn by using the swap? 

Consider the following basic $100 million CDO structure. The senior tranche has a par value of $70 million dollars and a coupon rate of LIBOR + 1.0%. The mezzanine tranche has a par value of $20 million and a coupon rate equal to 8.25%. The equity tranche has a par value of $10 million. Fees are equal to 4.2% of the equity tranche’s par value. The collateral consists of bonds with a coupon 9.75% that mature in ten years. A ten-year interest rate swap with notional principal of $70 million dollars is available that receives fixed rate of 5.25% and pays the LIBOR. Design a CDO that satisfies the above requirements. What is the potential annual return (in percent)  to the equity tranche assuming no defaults?

Reducing the amount of skill needed for a job is know as 

Simplify: (18+4i)+(-11+23i){“version”:”1.1″,”math”:”(18+4i)+(-11+23i)”} _______

Solve for x (Round to two decimal places if necessary): 3×2-33x+54=0{“version”:”1.1″,”math”:”3×2-33x+54=0″} _______ _______