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may 2013 diet

H

HARDIK

Member
Q)..The face value of a one year bond is 1,000 and the rate of interest on the bond is 10%. The current market value of the bond is 850 and is expected to rise to 900 in 10 days’ time. What is the nominal value of this bond?
A) 900
B) 1,000
C) 850
D) 900

Q)..ABC is an expanding mutual fund. The total assets of the ABC mutual fund are 25 crore and the number of units are 5 crore. If the bid offer spread is 5% and the offer price is 5.3684 then what is the bid price?
A) 5.6368
B) 5.1000
C) 5.0000
D) 5.2631

can somebody explain this as only the correct answer is given in the solutions......
thanks and regards....
 
Last edited by a moderator:
HARDIK said:
Q)..The face value of a one year bond is 1,000 and the rate of interest on the bond is 10%. The current market value of the bond is 850 and is expected to rise to 900 in 10 days’ time. What is the nominal value of this bond?
A) 900
B) 1,000
C) 850
D) 900
Click to expand...
Answers A and D are the same? I am sort of hoping that D is 910?
HARDIK said:
Q)..ABC is an expanding mutual fund. The total assets of the ABC mutual fund are 25 crore and the number of units are 5 crore. If the bid offer spread is 5% and the offer price is 5.3684 then what is the bid price?
A) 5.6368
B) 5.1000
C) 5.0000
D) 5.2631
Click to expand...
5.3684 * 0.95 = 5.1
Because the offer is 5% higher than the bid.
 
The nominal value is the par value or the face value, ie 1,000.
 
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