1) The investor presently holding $1 million in long-term Treasury bonds becomes worried about rising volatility in interest rates. She makes a decision to hedge her risk using Treasury bond futures contracts. Must she buy or sell such contracts?
Treasurer of the corporation which will be issuing bonds in three months also is worried about interest rate volatility and wishes to lock in price at which he could sell 8% coupon bonds. How would he utilize Treasury bond futures contracts to hedge his firm’s position?
Requirements
Min Pages: 1
2) Why do finance managers require knowing various existing options in merger deals and financial reporting of mergers? Write down the implications that these concepts have for corporate finance?
What do you mean by “synergy” and “merger of equals?” How have such concepts been used successfully in M & As? How have they been utilized unsuccessfully? Take a look at companies which have merged for synergistic reasons. Determine the suitable example that is four or more years since the merger. Describe where are the companies now? Did they meet their financial objectives?
Requirements
Min Pages: 3
Max Pages: 4