An investment in consol bonds promises to provide an interest payment of $2.5 million a year in perpetuity. If the interest rate is 3.3%, what is the value of this investment?
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- Which of the following investments that pay will $18,500 in 8 years will have a higher price today? The security that earns an interest rate of 8.50%. The security that earns an interest rate of 12.75%.Your liabilities consist of a payment of $5 million coming due in two years and a payment of $4 million coming due in three years. The market interest rate is 2%. What are the duration and convexity of your liabilities? O 2.71 and 7.64 O 2.80 and 9.17 O 2.21 and 5.39 O 2.44 and 6.20Assume annual mortgage payments of $12,000 for 30 years and an interest rate of 6.168% per year. What initial principal or PW will this repay?
- what;s the present value of perpetuity that pays % 1, 563 per year if the appropriate interest rate is 6.8% ?How much should an investor pay for an investment that pays an interest rate of 10% in form of end-of-year payments of $100.00 and $3,000.00 at maturity after 4 years?You buy a bond that pays annual interest payments of 7% of the bond’s face value of $1000. You initially pay $950 for the bond. You receive an annual interest payment after one year, then sell the bond for $880. What is your total rate of return on the investment, expressed as a percentage of the purchase price?
- The annual payment of a 10-year fixed-income security is $50. The payments are made at the end of each year. The market-required rate of return is 10%. What is the current price of the securities?A 1000 bond bearing interest at 5.4% payable semi-annually is due in three years. If money is worth 4.6% compounded semi-annually, what is the value of the bond if purchased today? What is the premium or discount?Suppose you borrow $70,000 at 5.25% annual interest to be repaid with a fully amortized plan over 14 years (equal end-of-year payments). What is the annual payment? What is the total amount of principal and interest paid?
- A one-year investment is certain to pay £650. If the annual interest rate is 6%. * Round your answer to the nearest pound. What is the present value of the payment on the day of the investment?A bank promises to quadruple your investment over a period of 15 years based on semi-annual compounding. What is the stated annual interest rate on this investment?Calculate the capital recovery factor (in percent) given that the nominal rate for a 12year-semi-quarterly compounded rate is 10.97% in an ordinary annuity. Need it asap pls
