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Consider a bond with a
5%
annual coupon and a face value of
$900.
Complete the following table. (Enter your responses rounded to two decimal places.)
Years to Maturity | Yield to Maturity | Current Price |
3 | 3% | $951.679 |
3 | 5% | $900 |
4 | 5% | $900 |
6 | 3% | $999.08 |
6 | 7% | $810.75 |
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- A bond with a face value of $5,000 pays quarterly interest of 3 5 percent each period. Thirty-four interest payments remain before the bond matures. How much would you be willing to pay for this bond today if the next interest payment is due now and you want to earn 8 percent compounded quarterly on your money? Click the icon to view the table of compound interest factors for discrete compounding periods when i = 2% You should pay $ (Round to the nearest cent as needed )Jon’s grandfather was planning to give him $11,000 in 14 years. Jon has convinced him to pay him $7,000 now, instead. If Jon invests this $7,000 at 6.5% compounded continuously how much money will he have in 14 years? a) What type of problem is this? Select an answer Future Value -Simple Interest Future Value - Compound Interest Future Value - Continuously Compounded Future Value - Ordinary Annuity Future Value - Annuity Due Present Value - Ordinary Annuity Present Value - Annuity Due b) How much will he have? (round to the nearest cent) $Q- ramdev A $3,500 bond with a 4% coupon compounded semi-annually is currently priced to yield 8% with 16 years remaining to maturity. What is the yield to maturity six years from now if the bond price rises $225 at that time?
- A company has issued a 20 year bonds, with a face value of $50,000. Interest at 8% is paid quarterly. If an investor desires to earn 12%, compounded quarterly, what would be the purchase price of the bond?Cash Flow is based on the notion that a dollar paid in the future is less valuable than a dollar paid today. Part 2 The present value of a loan in which $1000 is to be paid out a year from today with the interest rate equal to 5% is $. (Round your response to the neareast two decimal place) Part 3 If a loan is paid after two years, and the amount $7000 is to be paid then with a corresponding 7% interest rate, the present value of the loan is $. (Round your response to the neareast two decimal place)Cash Flow is based on the notion that a dollar paid in the future is less valuable than a dollar paid today. Part 2 The present value of a loan in which $1000 is to be paid out a year from today with the interest rate equal to 5% is $.(Round your response to the neareast two decimal place) Part 3 If a loan is paid after two years, and the amount $7000 is to be paid then with a corresponding 7%interest rate, the present value of the loan is $.(Round your response to the neareast two decimal place)
- 1. You needed $10,000 and obtained the following loan: Loan specifics: You are expected to pay 24 equal monthly installments (SA per month) at APR 12%, compounded monthly, starting from a month from obtaining the loan. If you miss a payment, your APR goes up to 24%, duration of the loan does not change but your monthly fixed payments go up. You miss your 12th payment. On the day of your 13th payment, the bank offers you a new deal. If you pay an additional $820 at the time of your 13th payment, you will continue to make your payments as before with no interest hike. a) Would you prefer to make the additional payment or have the interest hike?What is the yield to maturity on a simple loan of $35,000 that requires a repayment of $40,000 in 3 years?17. Gracie bought a CD for $810 that earns a 2.9% APR and is compounded quarterly. The CD matures in 5 years. How much will this CD be worth at maturity? $963.34 $909.25 $883.35 $935.90
- Many persons prepare for retirement by making monthly contributions to a savings program. Suppose that $2,600 is set aside each year and invested in a savings account that pays 8% interest per year, compounded continuously. a. Determine the accumulated savings in this account at the end of 23 years. b. In Part (a), suppose that an annuity will be withdrawn from savings that have been accumulated at the EOY 23. The annuity will extend from the EOY 24 to the EOY 32. What is the value of this annuity if the interest rate and compounding frequency in Part (a) do not change?A young engineering company is a subcontractor in an effort to develop technology that will reliably detect and respond to release of a nuclear weapon. The company is in need of additional funding and issues a series of $1,000 face value bonds that pay a nominal annual rate of 6% with quarterly payments. The bond matures in 6 years.A bond with a face value of $4,000 pays quarterly interest of 1.5 percent each period. Thirty-four interest payments remain before the bond matures. How much would you be willing to pay for this bond today if the next interest payment is due now and you want to earn 8 percent compounded quarterly on your money? Click the icon to view the table of compound interest factors for discrete compounding periods when i=2%