A security pays you an annual amount of $900 for 10 years. The seller of the security requires the first payment to be made today and the last payment to be made 9 years from today. Interest rate on this security is 5.75 percent per annum. Calculate the present value rounded to 2 decimal places.
A security pays you an annual amount of $900 for 10 years. The seller of the security requires the first payment to be made today and the last payment to be made 9 years from today. Interest rate on this security is 5.75 percent per annum. Calculate the present value rounded to 2 decimal places.
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
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1 a. A security pays you an annual amount of $900 for 10 years. The seller of the security requires
the first payment to be made today and the last payment to be made 9 years from today.
Interest rate on this security is 5.75 percent per annum. Calculate the
2 decimal places.
b. You are buying your first car for $20,000 and are paying $2,000 as a down payment. You
have negotiated a nominal interest rate of 12 percent and you plan to pay-off the car
over five years. What is the monthly payments you must make on this loan?
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