FIN 306 FINAL EXAM NEWEST 2026 ACTUAL EXAM| FIN 306 FINAL EXAM REVIEW WITH COMPLETE REAL EXAM QUESTIONS AND CORRECT VERIFIED ANSWERS/ ALREADY GRADED A+ (MOST RECENT!!)

FIN 306 FINAL EXAM NEWEST 2026 ACTUAL
EXAM| FIN 306 FINAL EXAM REVIEW WITH
COMPLETE REAL EXAM QUESTIONS AND
CORRECT VERIFIED ANSWERS/ ALREADY
GRADED A+ (MOST RECENT!!)


A pension fund is evaluating a 4-year bond with a face value of
$1,000, paying an annual coupon of 7%. The market requires a 9%
yield. The fund also wants to assess interest rate risk using
duration. What is the approximate Macaulay duration?
a) 3.12 years
b) 3.35 years
c) 3.60 years
d) 4.00 years – Correct Answer - b
PV-weighted cash flows discounted at 9% → duration ≈ 3.35
years.


A bank holds:
$120M mortgages (duration 7 years)
$50M corporate bonds (duration 12 years)
$30M T-bills (duration 0.25 years)
What is the portfolio duration?
a) 6.10


pg. 1

,b) 6.85
c) 7.20
d) 8.00 – Correct Answer - b
Weighted avg = (840 + 600 + 7.5)/200 = 6.85


A bond portfolio has duration of 5.8. Interest rates increase by
1.25%. What is Approximate % price change:
a) −5.8%
b) −6.5%
c) −7.25%
d) −8.0% – Correct Answer - c
−5.8 × 1.25% = −7.25%


A firm has a liability due in 6 years. It constructs a bond portfolio
with duration 6.5.
What is the risk implication?
a) perfectly immunized
b) under-hedged interest rate risk
c) over-hedged exposure
d) no risk – Correct Answer - c
Duration mismatch → overexposure.


pg. 2

, An investor buys a 5-year zero coupon bond yielding 6%. Face
value $10,000. Price is closest to:
a) $7,000
b) $7,472
c) $8,000
d) $8,300 – Correct Answer - b


A project requires $250,000 initial investment and generates:
Year 1: 80,000
Year 2: 90,000
Year 3: 100,000
Discount rate = 11%
NPV is:
a) +12,000
b) −8,000
c) +20,000
d) −15,000 – Correct Answer - a


A 3-year bond pays 8% annually with YTM 10% and FV 1,000.
Estimate Macaulay duration.
a) 2.2


pg. 3