Question
An insurance company invests in a ₹1,000 face value
bond carrying a 7% annual coupon, maturing in 10 years. Market interest rates fall to 5% soon after purchase. The bond is now trading at a premium. What happens if the company sells the bond before maturity in the secondary market?Solution
When interest rates fall, existing bonds with higher coupon rates (here 7%) become more attractive, increasing their market price. Selling at this higher price earns a capital gain.
I. 24x² - 58x + 23 = 0
II. 20y² + 24y – 65 = 0
Solve both equations I & II and form a new equation III in variable ‘r’ (reduce to lowest possible factor) using roots of equation I and II as per ...
I. 64x2 - 64x + 15 = 0
II. 21y2 - 13y + 2 =0
Solve the quadratic equations and determine the relation between x and y:
Equation 1: x² - 32x + 207 = 0
Equation 2: y² - 51y + 648 = 0
If a and b are the roots of x² + x – 2 = 0, then the quadratic equation in x whose roots are 1/a + 1/b and ab is
In the question, two equations I and II are given. You have to solve both the equations to establish the correct relation between 'p' and 'q' and choose...
I. y/16 = 4/y
II. x3 = (2 ÷ 50) × (2500 ÷ 50) × 42 × (192 ÷ 12)
The equation q2 - 17x + C = 0, has two roots ‘x’ and ‘y’ such that (x – y) = 7. Find an equation which is equal to thrice of the gi...
Solve the quadratic equations and determine the relation between x and y:
Equation 1: 41x² - 191x + 150 = 0
Equation 2: 43y² - 191y + ...
Solve the quadratic equations and determine the relation between x and y:
Equation 1: x² - 24x + 143 = 0
Equation 2: y² - 26y + 165 = 0
