A financial instrument provides three future cash flows:1. $1,406.01 at the end of 2 years2. $2,596.43 at the end of 8 years3. $1,172.62 at the end of 13 yearsCalculate the duration (D) of the financial instrument at a yield of 7% pa compounded yearly. Give your answer in years to 2 decimal places.Dyears

Step 1:We have to calculate the duration of the financial instrument.We will use the excel for…

Answered: A financial instrument provides three…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

See similar textbooks

Similar questions

1. Calculate the present value of $8,000 receive five years from today if your investment pay a. 6 percent compound annually b. 8 percent compound annually c. 10 percent compound annually d. 10 percent compound semiannually e. 10 percent compound quarterly
Calculate the future value in five years of $4,000 received today if your investments pay for the following interest rates. (Do not round intermediate calculations. Round your answers to 2 decimal places. (e.g., 32.16)) 6 percent compounded annually b. 8 percent compounded annually a. C. 10 percent compounded annually d. 10 percent compounded semiannually 10 percent compounded quarterly e. Future Value
Calculate the amount that must be invested at the end of each year at 9.3% compounded annually in order to accumulate $530,000 after: (Do not round intermediate calculations and round your final answers to 2 decimal places.) a. 25 years. $ b. 30 years. $ In each case, also determine what portion of the $530,000 represents earnings on the annual investments. (Round your intermediate calculations and final answers to 2 decimal places.) a. Earnings portion $ b. Earnings portion $
A6) Finance A financial instrument provides three future cash flows: $1,710.00 at the end of 3 years $1,051.74 at the end of 8 years $2,105.93 at the end of 14 years Calculate the duration (D) of the financial instrument at a yield of 6% pa compounded yearly. Give your answer in years to 2 decimal places. D = years
What is the future value of an annuity due of $800 paid semi-annually for the next 7 years, with a yield of 5% p.a. compounded semi-annually? Select one: a. $13,215.16 b. $6,923.22 c. $11,200.00 d. $13,545.54
$100 is deposited each quarter for 5 years. What is the future value of the account if interest rate is 12% per year compounded monthly. a) $ 2695.76 b) $ 2735.27 c) $3095.24 d) $2534.35
1. At the end of each quarter for the next 12 years you will receive a cashflow of $5200. If the APR is 7.25% compounded quarterly, then what is the value today? $165,760 $112,897 $156,783 $105,781
If $100,000 is invested at 5.0% annual interest, compounding monthly, what is the balance after 3 years? a. $133,333 b. $152,120 c. $161,472 d. $159,124
Present Value of an Annuity Determine the present value of $310,000 to be received at the end of each of four years, using an interest rate of 6%, compounded annually, as follows: a. By successive computations, using the present value of $1 table in Exhibit 5. Round to the nearest whole dollar. First year $fill in the blank 1 Second Year fill in the blank 2 Third Year fill in the blank 3 Fourth Year fill in the blank 4 Total present value $fill in the blank 5 b. By using the present value of an annuity of $1 table in Exhibit 7. Round to the nearest whole dollar.$fill in the blank 6 c. Why is the present value of the four $310,000 cash receipts less than the $1,240,000 to be received in the future?The present value is less due to..........................over the 4 years.
Calculate the future value of the following single amounts. Initial Investment Annual Rate Interest Compounded Period Invested 1. $8,000 10% Annually 7 years 2. 6,000 12 Semiannually 4 years 3. 9,000 8 Quarterly 3 years
Calculate the annual percentage yield for a certificate of deposit in the amount of $10,000 that will earn a total of $1,250 in interest during a term of 5 years (assume 365 days per year) Multiple Choice: 1.92% 0.89% 2.38% 12.5%

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS