Exhibit 19 &Nbsp; &Nbsp; &Nbsp; &Nbsp; &Nbsp; &Nbsp; &Nbsp; &Nbsp; &Nbsp; &Nbsp;

question 9

Multiple Choice

Exhibit 19.3
Use the Information Below for the Following Problem(S)
The following information is given concerning a pure yield pick-up swap: You currently hold a 20 year, Aa 8 percent coupon bond priced to yield 10 percent. As a swap candidate you are considering a 20 year, Aa 10 percent coupon bond priced to yield 10.75 percent. Assume a reinvestment rate of 12.00 percent, semiannual compounding, and a one-year workout period.
$\begin{array}{lcc} & \text { Curent Bond } & \text { Candidate Bond } \\\hline \text { Dollar Investment } & \$ 828.41 & \$ 938.83 \\\text { Coupon } & 80.00 & 100.00 \\\text { i on One Coupon } & 2.4 & ? \\\text { Principal Value at Year End } & 831.32 & ? \\\text { Total Accrued } & 913.72 & ? \\\text { Realized Compound Yield } & & ?\end{array}$
                                                                                10.5547
-Refer to Exhibit 19.3.The value of the swap is ____ basis points in one year.

• A) 40.4
• B) 60.6
• C) 80.8
• D) 20.5
• E) 100.1

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Definitions:

Reinforcing

The process of increasing the likelihood of a behavior's occurrence by adding or removing a stimulus following the behavior.

Disruptive

Behavior that interrupts or disturbs the normal flow or operation of activities, often seen as undesirable in social and educational contexts.

Animal Subjects

Animals used in research or experiments in order to observe biological, psychological, or social processes that could provide insights relevant to humans or other animals.

Behavioral Laws

Fundamental principles or rules that explain and predict how organisms behave, often based on consequences of actions in terms of rewards and punishments.