All variables and functions are to be typed (declared). Hint: option explicit. SIN and COS are the Excel functions and are for comparison.
1. A cosine can be approximated by the following infinite series:
cos??x=1- (x^2/2!)?+ (x^4/4!)- (x^6/6!)+ . . . Write a function that will calculate this for any x and y number of terms. If y > 85 or y is not a positive integer, return an error.
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X
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Y
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Cos( x)
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MyCosine (x,y)
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Approximation error
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0.31831
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9
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|
|
|
|
0.95493
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9.5
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|
|
|
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1.27324
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37
|
|
|
|
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1.591549
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65
|
|
|
|
|
2.228169
|
88
|
|
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|
2. An index linked note is an instrument that provides investors fixed income-like principal protection together with equity market upside exposure. It is structured by combining the economics of a long call option on equitywith a long discount bond position.The investment pays the greater of the par value, $1,000, or the price times the percentage increase in the S&P 500.
Write 2 functions (elnPayoff, elnReturn). The first, elnPayoff, calculates the security payoff at maturity. The second, elnReturn, calculates the annualized return assuming continuous compounding. The function elnReturn should call the payoff function.
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Price
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Years
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SP5000
|
SP5001
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Payoff
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Return
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|
961
|
1
|
1783
|
1995
|
|
|
|
923
|
2
|
1298
|
1498
|
|
|
|
819
|
5
|
1288
|
1568
|
|
|
|
727
|
8
|
1335
|
1270
|
|
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