Exhibit 16-5
USE THE FOLLOWING INFORMATION FOR THE NEXT PROBLEM(S)

question 28

Multiple Choice

Exhibit 16-5
USE THE FOLLOWING INFORMATION FOR THE NEXT PROBLEM(S)
The following information is given concerning a pure yield pick-up swap: You currently hold a 20 year, Aa 2% coupon bond priced to yield 9.5%. As a swap candidate you are considering a 20 year, Aa 14% coupon bond priced to yield 10.00. Assume a reinvestment rate of 11%, semiannual compounding, and a one-year workout period. $\begin{array}{lcc}&\text { Current Band } & \text { Candidate Band } \\\hline\text { Dollar Investment } & \$ 1222.04 & \$ 1343.18 \\\text { Coupon } & 110.00 & 140.00 \\\text { i on One Coupon } & 3.3 & ? \\\text { Principal Value at Year End } & 1218.04 & ? \\\text { Total Accrued } & 1341.34 & ? \\\text { Realized Compound Yield } & 9.5351 \% & ?\end{array}$

-Refer to Exhibit 16-5. The interest on one coupon for the candidate bond is

• A) $70.00
• B) $3.58
• C) $3.85
• D) $8.35
• E) $5.38

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Definitions:

Artifacts

Objects made by human beings, typically with cultural or historical interest; in organizational culture, these can also include symbols, rituals, and practices.

Organizational Culture

Pertains to the shared beliefs, values, norms, and practices that shape the social and psychological environment of a business or organization.

Countercultures

Subcultures or groups within a society that significantly differ and may oppose certain aspects of the dominant culture or mainstream values.

Surveillance

The close observation or monitoring of activities or individuals, often used for protection, security, or data gathering.