1. A perpetuity makes annual payments of $300. The perpetuity is valued using a 8% discount rate. What is the value of the perpetuity if the first payment is made immediately?
2. In the normal condition interest rate of long term debt instrument is higher than short term debt instrument?explain also in what circumstance interest rate of long term debt instrument is lower than short term instrument
3. The (annual) standard deviation of the currency portfolio of your firm is estimated to be 15 percent. You are in the process of assessing currency risk over the next quarter. What is the appropriate quarterly standard deviation? (use p.pp%)