You have $1,000 to invest over an investment horizon of three years. The bond market offers various options. You can buy (i) a sequence of three one-year bonds; (ii) a three-year bond; or (iii) a two-year bond followed by a one-year bond. The current yield curve tells you that the one-year, two-year, and three-year yields to maturity are 3.5 percent, 4.0 percent, and 4.5 percent respectively. You expect that one-year interest rates will be 4 percent next year and 5 percent the year after that. Assuming annual compounding, compute the return on each of the three investments. a. Expected return for (i)
b. Expected return for (ii)
c. Expected return for (iii)

If the ceo of a large, diversified, firm were filling out a fitness report on a division manager (i.e., "grading" the manager), which of the following situations would be likely to cause the manager to receive a better grade? in all cases, assume that other things are held constant.a. the division's basic earning power ratio is above the average of other firms in its industry.b. the division's total assets turnover ratio is below the average for other firms in its industry.c. the division's debt ratio is above the average for other firms in the industry.d. the division's inventory turnover is 6, whereas the average for its competitors is 8.e. the division's dso (days' sales outstanding) is 40, whereas the average for its competitors is 30.