Over a given year the force of interest p.a is a linear function of time, falling from 0.15 at the start of the year to 0.12 at the end of the year. The value at the start of the year of the nominal rate of interest per annum on a transaction of 1 month term is: Select one: a. 0.28 O b.0.14 c. 0.07 d. 0.21

Over a given year the force of interest p.a is a linear function of time, falling from 0.15 at the start of the year to 0.12 at the end of the year. The value at the start of the year of the nominal rate of interest per annum on a transaction of 1 month term is: Select one: a. 0.28 O b.0.14 c. 0.07 d. 0.21

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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Question

Over a given year the force of interest p.a is a linear function
of time, falling from 0.15 at the start of the year to 0.12 at the
end of the year. The value at the start of the year of the
nominal rate of interest per annum on a transaction of 1
month term is:
Select one:
a. 0.28
O b.0.14
c. 0.07
d. 0.21

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FOLLOWING QUESTIONS: 1. Consider that the number of periods and the amount of equal installment every year is the same with the given yet the prevailing market interest rate is 10%, how much would be the present value at 01/01/2020? A.973,684 B.1,088,815 C.1,217,105 D. 1,241,910 2. How much is the interest expense on December 31, 2020? A. 91,121 B. 108,143 C. 123,342 D. 136,913 3. How much is the interest expense on December 31, 2021? A. 108,143 B. 123,342 C. 136,913 D. 250,000 4. How much is the Present value at December 31, 2022? A. 600,459 B. 759,339 C. 901,195 D. 1,027,853 5. How many periods or equal installments to pay the Note Payable? A. 5 B. 6 C. 7 D. 8 6. How much is the annual installments? A. 200,000 B. 225,000 C. 250,000 D. 260,000 7. On 12/31/2020, the CURRENT PORTION of the Note Payable would be? A. 113,087 B. 126,658 C. 141,857 D. 158,879 PLEASE PROVIDE SOLUTIONS EVERY ANSWERS. THANK YOU!
Which one of the following represents the highest effective interest rate per year? Select one: O a 10.5% per year, compounded semiannually O b. 10.4% per year, compounded daily Oc 10% per year, compounded quarterly Od. 10% per year, compounded monthly O e. 9.8% per year, compounded continuously
For compounding more frequently than annual, the effective interest rate Select one: a. is higher than the nominal rate b. is lower than the nominal rate c. depends on the amount borrowed 18 d. equal to the nominal rate
The n-year spot rate of interest per annum, in, is given by: b in = a(1.1)" +- n for n = 1, 2 and 3 and where a and b are constants. With time measured in years from the present, the implied one-year forward rates applicable at time 0 and at time 1 are 7.3% and 6.8%, respectively. Showing all of your workout, calculate to 5 decimal places the following: (i) the values of a and b; (ii) the implied two-year forward rate applicable at time 1; (iii) the price per £1 nominal at time t = 0 of a bond which pays annual coupons of 7% in arrears and is redeemed at 95% after 3 years.
Which one of the following represents the highest effective interest rate per year? Select one: O a. 10.5% per year, compounded semiannually Ob. 10.4% per year, compounded daily O c. 10% per year, compounded quarterly O d. 10% per year, compounded monthly O e. 9.8% per year, compounded continuously
3.8 The following table shows the spot rates of interest over a number of horizons: (a) Find the present value of payments of $100 at the end of each year for 4 years. Period of investment (in years) Spot rate (in %) 1 6.00 2 7.00 3 7.75 4 8.25
10. Find the per period rate and the APR (the stated interest rate) for each case: (Round Per period rate to 3 decimal places.) Effective Annual Intrest Rate Compounding Period Per Period Rate APR 10.00% 1 month 6.09% 6 months 8.24% 3 months
Find the total number of compounding periods and the interest rate per period for the investment. Term ofInvestment Nominal(Annual) Rate (%) InterestCompounded CompoundingPeriods Rate perPeriod (%) 4 years 4.5 semiannually
Find the total number of compounding periods and the interest rate per period for the investment. Term of Investment Rate per Period (%) Nominal Interest Compounding Perlods (Annual) Rate (%) Compounded 8 years quarterly
Pls show complete steps and both parts or skip it
13 When interest is calculated for periods shorter than a year, the formula to calculate interest is: Multiple Choice I = P × R × T, where I = interest calculated, P = principal, R = annual interest rate, and T = number of months. I = P × R × T, where I = interest calculated, P = principal, R = annual interest rate, and T = (number of months ÷ 12). I = P × R × T, where I = interest calculated, P = principal, R = monthly interest rate, and T = (number of months ÷ 12). I = (MV − P)/T, where I = interest calculated, MV = maturity value, P = principal and T = number of months.
What is the future value of $90,380.00 given an interest rate of 17.00% compounded quarterly for 37years? a. $30, 126,537.59 b. $42, 788, 765.48 c. $169, 361.93 d. $132,823.81

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