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NEW QUESTION: 1
Imagine two perpetual bonds, ie bonds that pay a coupon till perpetuity and the issuer does not have an obligation to redeem. If the coupon on Bond A is 5%, and on Bond B is 15%, which of the following statements will be true:
I. The Macaulay duration of Bond A will be 3 times the Macaulay duration of Bond B.
II. Bond A and Bond B will have the same modified duration
III. Bond A will be priced at less than 1/3rd the price of Bond B
IV. Both Bond A and Bond B will have a duration of infinity as they never mature
A. I and II
B. III and IV
C. II
D. IV and I
Answer: C
Explanation:
Explanation
The modified duration of a perpetual bond is given by 1/i, where i is the yield. Since I is a positive number greater than zero, it means the modified duration of a perpetual bond is not infinity. Also note that this formula makes no reference to the coupon rate at all - in other words, the modified duration of a perpetual bond is independent of the coupon. The Macaulay duration of a perpetual bond is given by (1+i)/i, again a formula devoid of any references to the coupon. The price of a perpetual bond can be calculated as Coupon/i, which means that a 15% coupon perpetual bond will be priced at exactly 3x the price of a 5% coupon bond.
Based on the above, statement I is incorrect, but statement II is correct. Statement III is incorrect because Bond A will be priced at exactly 1/3rd the price of Bond B, and not less than that. Similarly, statement IV is incorrect as well.
Intuitively, a perpetual bond is nothing but a perpetual annuity, which will have a present value equal to 1/i * cash flow (which in this case is the coupon). The coupon rate only sets the cash flow dollar amount - there is really no difference between the two bonds described in the question except that buying one of Bond B is economically identical to buying three of Bond A.

NEW QUESTION: 2
You search for resources to fulfill a project resource request but are unable to proceed after receiving the following error message: "The search for resources cannot be completed because the project resource search index is not available. Contact your help desk." Identify the cause for this error message. (Choose the best answer.)
A. The most recent update of the index finished successfully.
B. The index is not in the process.
C. The index is in the process of being updated.
D. The index has been built.
Answer: C
Explanation:
Explanation
Ref:
https://docs.oracle.com/en/cloud/saas/project-portfolio-management/19a/fapfm/implementing-project-execution- Topic - Submitting the Process to Maintain Project Resource Search Index: Procedure Submit the Maintain Project Resource Search Index job set to update the resources that appear on the Search and Evaluate Resources page when a resource manager searches for resources to fulfill project resource requests. The job set consists of a set of processes that facilitate efficient and rapid searches for qualified resources.
Resource managers can't search for resources or view resource details if the search index isn't available for a project resource request with qualifications or keywords. For project resource requests without qualifications and keywords, resource managers can search for and evaluate resources based on resource availability even if the search index isn't current or available.
Caution: The search index isn't available if the Maintain Project Resource Search Index job set process fails, or while the process is running.

NEW QUESTION: 3
Which of the following statements is NOT true regarding queue manager clusters?
A. Provides for workload balancing
B. Requires a separately installed component
C. Can be dynamically joined by participating queue managers
D. Simplifies distributed queue management
Answer: B

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