Reference no: EM13862443

All variables and functions are to be typed (declared). Hint: option explicit. SIN and COS are the Excel functions and are for comparison.

1. A cosine can be approximated by the following infinite series:

cos??x=1- (x^2/2!)?+ (x^4/4!)- (x^6/6!)+ . . . Write a function that will calculate this for any x and y number of terms. If y > 85 or y is not a positive integer, return an error.

2. An index linked note is an instrument that provides investors fixed income-like principal protection together with equity market upside exposure.  It is structured by combining the economics of a long call option on equitywith a long discount bond position.The investment pays the greater of the par value, $1,000, or the price times the percentage increase in the S&P 500.

Write 2 functions (elnPayoff, elnReturn).  The first, elnPayoff, calculates the security payoff at maturity.  The second, elnReturn, calculates the annualized return assuming continuous compounding.  The function elnReturn should call the payoff function.