Let a, b and c be real numbers. Which of the following statements is true?
Every covariance matrix must be positive semi-definite. If it were not then:
A 2-year bond has a yield of 5% and an annual coupon of 5%. What is the Macaulay Duration of the bond?
In a binomial tree lattice, at each step the underlying price can move up by a factor of u = 1.1 or down by a factor of . The continuously compounded risk free interest rate over each time step is 1% and there are no dividends paid on the underlying. The risk neutral probability for an up move is:
When the errors in a linear regression show signs of positive autocorrelation, which of the statements below is true?
In a quadratic Taylor approximation, a function is approximated by:
Exploring a regression model for values of the independent variable that have not been observed is most accurately described as…
For each of the following functions, indicate whether its graph is concave or convex:
Y = 7x2 + 3x + 9
Y = 6 ln(3x)
Y = exp(-4x)
Which of the following can be used to evaluate a regression model?
(i) Magnitude of R2
(ii) Magnitude of TSS (total sum of squares)
(iii) Tests for statistical significance
(iv) Sign and magnitude of each regression parameter
Let N(.) denote the cumulative distribution function and suppose that X and Y are standard normally distributed and uncorrelated. Using the fact that N(1.96)=0.975, the probability that X ≤ 0 and Y ≤ 1.96 is approximately
TESTED 15 Oct 2025