1. What are the effects of severe inflation? Are their any positive effects (think about debt)? What are your thoughts about the U.S. Economic Inflation/Collaspe?
2. Explain the primary use of funds by commercial banks versus savings institutions?
3. For a loan with four-year maturity, semiannual interest payments, an 8% annual interest rate, $1,000 face amount, what is Macaulay’s duration at a yield of 9%?