What is the year four cumulative default probability

Assignment Help Financial Management
Reference no: EM131917365

1. Consider the fixed payer position in a 5.15%/LIBOR swap. What is the net swap CF for the fixed payer on a payment date in which the LIBOR rate used for the payment is 3.98%? Assume a $5M notional principal and semi-annual payments

2. Assume that 50% of a certain type of bonds have defaulted at any point from year 0 through the end of year 3. The year 4 conditional default probability is 50%. What is the year 4 cumulative default probability?

Reference no: EM131917365

Questions Cloud

Siscuss pursuing of a business course : I am writing this memo to discuss my pursuing of a business course at the Lehman College City of New York.
Implement very fast algorithms that make initial processing : In digital signal processing, it is important to implement some very fast algorithms that make initial processing of a digitized signal stream.
Why would a firm choose one form over another : What are the relative advantages and disadvantages of each form of doing business in a foreign country? Why would a firm choose one form over another?
Supporting the evolutionary background of modern : A major kind of evidence supporting the evolutionary background of modern life forms is "signatures of history." Explain just what this term means
What is the year four cumulative default probability : The year 4 conditional default probability is 50%. What is the year 4 cumulative default probability?
Discuss different form of corporate global regulation : Judge Leo Strine, the Vice Chancellor of the Delaware Court of Chancery (the Delaware Court with original jurisdiction over state corporate law cases).
Darwin original theory of evolution : Explain the primary way in which the New Synthesis is different from Darwin's original theory of evolution.
Calculate the net present value of capital investment : Calculate the net present value of the capital investment. Calculate the payback period of the capital investment.
Create a list of valid entries and correct results for sets : Create a list of valid entries and the correct results for each set of entries. Then, make sure that the results are correct when you test with these entries.

Reviews

Write a Review

Financial Management Questions & Answers

  What is the total percentage return for the investment

Suppose you purchase 800 shares of stock at a price of $20 per share. One year later, the shares are selling for $23 per share. In addition, a dividend of $2 per share is paid at the end of each year. What is the capital gains yield for the investmen..

  Present and future values for different interest rates

Find the following values. Compounding/discounting occurs annually. Define present value.

  Approximate coupon rate on the outstanding bond

The current required rate of return on a bond issued by Who LTD is 11 percent. "Who" has a bond issue outstanding that pays interest semi annually, is selling for $845 and matures in 8 years. What is the approximate coupon rate on the outstanding bon..

  Stipulated forward price on the entered forward contract

Assuming the three-month risk-free rate is 10%, what was the appropriate stipulated forward price on the entered forward contract.

  Are the us current account and external debt sustainable

Are the U.S. current account and external debt sustainable? Does the U.S. differ or not from emerging markets or not and why?

  Provide a rationale with your response

State whether or not there are any other times appropriate for recognizing revenue. Provide a rationale with your response.

  What will be amount of interest accumulated at the time

Emilys current salary is $85,000 per year, and she is planning to retire 24 years from now. She anticipates that her annual salary will increase by$1,000 each year ($85,000 the first year, to $86,000 the second year, $87,000 the third year, and so fo..

  Value of the firm prior to the downgraded credit rating

A firm with a normalized pretax income of $40 million, 25% tax rate, and a Total Debt/Total Capital ratio of 30%, decides to undertake a capital expansion financed by new debt. The new level of debt will raise the Total Debt/Total Capital ratio to 40..

  What must the risk-free rate be

A stock has an expected return of 14 percent, a beta of 1.70, and the expected return on the market is 10 percent. What must the risk-free rate be? (Round your answer to 2 decimal places. Omit the "%" sign in your response.)

  Considering the purchase of new machine costing

The management of London Corporation is considering the purchase of a new machine costing $750,000.

  What is the net present value of new line at discount rate

What is the net present value of the new line at a discount rate of 11.5 percent and a tax rate of 35 percent?

  Match the yield to maturity to the terms of the bond

Match the yield to maturity to the terms of the bond. All of these bonds pay interest twice a year.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd