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- 12:42 Expert Q&A Done e bond wi e wth S en and dd 1 y Howuh wod an be wilngt pay r ths bonda5 pr yr y d con te e the intrt and annly to d compunding when p yea The urnt worh ofhend oundt the ) Azero coupon bond will be worth $15,000 when it matures and is redeemed after 13 years. How much would an investor be willing to pay now for this bond if a 3% per year yield is desired? Click the icon to view the Interest and annuity table for discrete compounding when = 3% per year. The current worth of the bond is (Round to the nearest dollar)6. Morris paid £500 amonth for 20 years to pay off themortgage on his Glasgowhouse. Ifhis down payment was £5000 and the interest rate was 6 percent compounded monthly, what was the purchase price of the house?What is the interest rate on your credit card if after 10 years you owe $40 for a pizza that had a price of $10? The interest rate is _______. A. a monthly rate of 15/12 percent B. 15 percent per year compounded monthly C. a monthly rate of 15/365 percent compounded daily D. 15 percent per year compounded annually Submit
- What is the value of $600 at 12 percent interest for 7 years compounded continuosly? O A. $1356.54 B. $1372.76 O C. $1326.41 O D. $1389.82 Seçimimi temizle6. Ms. Jones wants to make 10% nominal interest compounded quarterly on a bond investment. She has an opportunity to purchase 8%, $10,000 bond that will mature in 14 years and pays quarterly interest. This means that she will receive quarterly entert payments on the lace value the bond 10.000$ at %8 nominal interest . After 14 years she will receive the face value of the bond. How much should she be willing to pay for the bond today? Ms. Jones should be willing to pay $ for the bond today (Round to the nearest dollar)6. You are given an annuity payable continuously at the rate of • $1000 per year while both (40) and (50) are alive • $600 per year while one of (40) and (50) is alive and the other is dead The present value of this annuity is $9400. A second annuity payable continuously at the rate of $1200 per ycar while either of them is alive has present value $13200. What is the present value of an annuity payable continuously at the rate of $1000 per year while one of (40) and (50) is alive and the other is dead?
- bond valuation An investor has two nonds in her portfolio, bond C and bond Z. each bond maturres in 4 years has a face value of 1000, and has a yield to maturity of 9.6% bond C pays a 10% annual coupon, while bond Z is a zeo coupon bond . b- assuming that the yield to maturity of each bond remains at9.6% over the next 4 years, calculate the price of the bonds at each of the following years to maturity year 4,3,2,1,0 b- plot the time path of price for each bondLewis’s management has been considering movingto a new downtown location, and they are concerned that these plans may come to fruition priorto the equipment lease’s expiration. If the moveoccurs then Lewis would buy or lease an entirelynew set of equipment, so management wouldlike to include a cancellation clause in the leasecontract. What effect would such a clause haveon the riskiness of the lease from Lewis’s standpoint? From the lessor’s standpoint? If you werethe lessor, would you insist on changing any ofthe other lease terms if a cancellation clause wereadded? Should the cancellation clause containprovisions similar to call premiums or any restrictive covenants and/or penalties of the type contained in bond indentures? Explain your answer.2) Two annuity dues in perpetuity have a common present value of $2, 000 and a common effective anmual interest rate i. The first anmuity makes payments of $100 at the beginning of every three years and the second makes payments of X at the beginning of every three months. Find X.
- Hero borrowed P 200,000.00 with interest at the rate of 5% compounded semi-annually. He agrees to discharge his obligation by paying a series of 8 equal semi-annual payments, the first being due at the end of 5 1/2 years. Find the semi-annual payment. O a. P50,043.00 O b. P50,340.00 O c. P50,403.00 d. P50,430.00Calculate the maturity value of a 300-day, $6,000 simple interest term deposit earning 5.15%. O a. $7,021.99 O b. $6,309.00 O c. $6,111.78 O d. $6,253.97 e. $5,756.346. At your first job you take advantage of an employer match program in which your employer will match up to 5% of your salary in a retirement savings plan if you also contribute 5%. Assume that your average salary over 5 years is $75,000, how much will you have saved in five years using a fund that pays 4% annual interest rate. Assume you only did 3% of your salary as retirement plan contribution. How much will you have in the fund, also 4%, after 5 years? Recalculate using a fund that pays 8%.
