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Corporate Finance, Quiz 1
Consider a bond which pays 500 units in 5 years and 1000 units in 10 years. What is the maturity and duration of the bond, respectively?
Consider a bond which pays 500 units in 5 years and 1000 units in 10 years. What is the maturity and duration of the bond, respectively? The table below relates to the economy of Galaland, where the typical consumer’s market basket consists of 2 clothes and 3 burgers. | Year | Price of a cloth | Price of a burger | |---|---|---| | 2017 | Rs 400 | Rs 30 | | 2018 | Rs 300 | Rs 50 | | 2019 | Rs 325 | Rs 70 | If the base year is 2017, then the economy’s inflation rate (as measured by CPI) in 2018 is Assume Shyam earns Rs. 10000 in period 1 and Rs 12000 in period 2. He spends his earnings on consumption in period 1 and period 2. The prices of consumption in period 1 and period 2 are the same (equal to 1). If prevailing interest rate is 10% then the slope of the intertemporal budget constraint is