1. The Early phase of S&L crisis of the late 1970's and early 1980's was associated with:
a. High interest rates interacting with a negative gap at the S&L's
b. Large S&L losses on international Loans
c. The Resoltuion Trust Corporation (RTC)
d. Federal Reserve attempts to stimulate the economy by keeping interest rates low.
2. You know that r1 = 5.0%, f2 = 5.8%, and r3=6% (the subscript indicates the year). What is the price of a 3-year government bond that pays a 10% annual coupon and has a $1000 face value? Done without financial calculator
A. $1024.87 B. $1106.92 C. $1108.84 D. $1113.40