Exhibit 21.4 USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)

question 31

Multiple Choice

Exhibit 21.4
USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)
A 3-month T-bond futures contract (maturity 20 years, coupon 6%, face $100,000) currently trades at $98,781.25 (implied yield 6.11%) . A 3-month T-note futures contract (maturity 10 years, coupon 6%, face $100,000) currently trades at $101,468.80 (implied yield 5.80%) . Assume semiannual compounding.
-Refer to Exhibit 21.4. Suppose the yield curve changed so the that the new yield on the T-bond contract rose to 6.5% and the new yield on the T-note contract fell to 5.5%. Calculate the profit on the NOB futures spread. (Assume coupons are paid semiannually)

• A)-$5850.92
• B)-$6,671.42
• C)$6,671.42
• D)$5850.92
• E)None of the above

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Definitions:

Metatarsals

The five long bones in the foot located between the tarsal bones of the hind- and mid-foot and the phalanges of the toes.

Metacarpals

The five long bones in the hand that are located between the wrist and the fingers.

Tarsals

Tarsals are a group of seven small bones that make up the ankle and the posterior part of the foot, supporting the body's weight during standing and movement.

Metatarsals

The long bones located in the foot between the ankle and the toes, crucial for weight bearing and movement.