Reference no: EM133079447
Question 1. Here are the details on 4 bonds. Current market rates are 5.5% for all 4 bonds.. Which bond would you buy and why? Hints: Current price is the 'Ask'; Show your calculations.
Bond A ABC Inc. 6% 10 Year Annual Pay Current Price $1,045.69
Bond B DEF Ltd. 4% 15 Year Quarterly Pay Current Price $850.47
Bond C MLM Inc. 5.5% 6 Year Semi - Annual Pay Current Price $998.40
Bond D TJB Ltd. 5.5% 10 Year Annual Pay Current Price $1,000.00
Question 2:
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2019
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2020
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Inflation
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122.00
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126.50
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GDP
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1973.40
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2039.20
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Unemployment Rate
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6.90
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6.30
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Exchange Vs $US
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1.01
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0.97
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Given the above information (Next page):
A. Calculate the inflation rate for 2020. Is this inside the range desired by the Bank of Canada? Why or why not?
B. Based on your answer above, what action is the Bank of Canada likely to take?
C. Based on the information above, what are your expectations for interest rates? Based on those expectations, if you are a bond speculator, what type of bonds should you be buying or selling?
Question 3:
Explain the role of the 'Gatekeeper' in Anti-money Laundering. Link this role to the IIROC Know your client requirements