EFN406 Managerial Finance Assignment

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Reference no: EM133119715

EFN406 Managerial Finance - Queensland University of Technology

Assignment Part - requirements

Two answers one in Excel and one in a Text box

You must provide a full answer with explanation and accompanied with the calculation done manually and one done in Excel.

Question: (a) The S&P/ASX200 price index opened the year at 7,200 and was at 7,683 by the end of the year. The S&P/ASX Small Ordinaries index went from 2,800 to 3,222 over the same period. What is the effective annual rate of return on each of these indices? Explain the difference in information provided by these two indices.

(b) Calculate the geometric average annual forward rates of return out to five years given the following annual spot rates, one year (oil = 0.65%), two year = 0.75%), three year (313 = 0.84%), four year (0i4 = 0.92%), five year Lis = 0.99%).

What does this imply about future interest rates?

Reference no: EM133119715

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