#12 - the solution states that the hedge fund was engaged in stock price manipulation. I must be missing something, but I do not see where that comes into the case.
#37 & 38 - Number 37 - the problem requires altering the portfolios exposure from bonds to cash and the solution shows the use of a target modified duration that is 0.25 for cash. Then, in question #38 it transfers the exposure from cash, but uses a modified duration of 0 for cash. I do not understand when we are suppose to use 0 and when we are supposed to use the 0.25 for cash’s modified duration. At the moment, I have tried solving it each way and luckily there has only been one of the possible solutions in answer choices. however, I would like to know the correct approach. Can anyone shed some light on this? Thank you in advance.