Question

7. A risk-free bond will pay you $1000 in 1 year. The annual discount rate is i = 3.45% compounded annually. What is PV of the bond?

8. A risk-free bond will pay you $1000 in 2 years and nothing in between. The annual discount rate is i = 3.15% compounded annually. What is the bond’s PV?

Answer #1

7)

8)

Can someone please teach me how to do these?
6. A risk-free bond will pay you $1,000 in 1 year. The annual
discount rate is i=19.69% compounded annually. What is
the bond’s present value?
7. A risk-free bond will pay you $1,000 in 2 years and nothing
in between. The annual discount rate is i=67.5% compounded
annually. What is the bond’s present value?

1. Suppose you save $18,000 per year at an interest rate of i=
5.21% compounded annually. How much will you have after 35
years?
2. A risk-free bond will pay you $1,000 in 1 year. The annual
discount rate is i= 3.69% compounded annually. What is the bond's
present value?
3. A risk-free bond will pay you $1,000 in 2 years and nothing
in between. The annual discount rate is i= 9.5% compounded
annually. What is the bond's present value?

1. Suppose you save $18,000 per year at an interest rate of i=
5.21% compounded annually. How much will you have after 35
years?
2. A risk-free bond will pay you $1,000 in 1 year. The annual
discount rate is i= 3.69% compounded annually. What is the bond's
present value?
3. A risk-free bond will pay you $1,000 in 2 years and nothing
in between. The annual discount rate is i= 9.5% compounded
annually. What is the bond's present value?

8. You buy a zero-coupon bond which will pay you $1000 in 30
years. Annual discount rate is i= 6% compounded once per year. A
few minutes later the discount rate rises to i= 7%. What is the
percent change in the value of the bond? Hint: if an answer is
negative, do not drop the minus sign.
9. You buy a zero-coupon bond which will pay you $1000 in 30
years. Annual discount rate is i= 14% compounded once...

1. Suppose you save $18,000 per year at an interest rate of i=
5.21% compounded annually. How much will you have after 35
years?
2. A risk-free bond will pay you $1,000 in 1 year. The annual
discount rate is i= 3.69% compounded annually. What is the bond's
present value?

show all works
1. The real risk-free rate of interest is 1%. Inflation is
expected to be 4% the next 2 years and 7% during the next 3 years
after that. Assume that the maturity risk premium is zero. What is
the yield on 3-year Treasury securities? (5 points)
2. The real risk-free rate of interest is 2.5%. Inflation is
expected to be 2% the next 2 years and 4% during the next 3 years
after that. Assume that the...

1)
how much should you pay for a $1000 bond with 6% coupon, annual
payments, and 16 years to maturity if the interested rate is 6%?
2) how much should you pay for a $1000 zero coupon bond with 5
years to maturity if the interest rate is 5%?
3) what is the rate of return for an investor who pays $1061
for a 3 year bond with an annual coupon payment of 6% and sells the
bond 1 year...

We have a 5% 1-year bond. The bond’s par is $1000. There is a
20% chance the company will go into bankruptcy and only pay
$500
1,What is the bond’s value? Assume that the company’s possible
default is totally unrelated to other events in the economy and
risk-free interest rate is 5%. 2,If on top of default risk,
investors require an additional 3 percent market risk premium, what
are the price value and YTM?

A $1000 par value bond with 3 years to maturity has a coupon
rate of 6% pa paid annually. compute the bond price if the interest
rate (compounded semi annually) are 7%, 8% and 9% respectively for
year 1, 2 and 3.

1. You are offered an investment that will pay $100 annually for
7 years (the first payment will be made at the end of year 1) plus
$2,900 at the end of year 7. If the appropriate discount rate is
5%, assume annual compounding, what is the investment worth to you
today?
2. You are offered an investment that will pay $100 annually for
7 years (the first payment will be made at the end of year 1) plus
$2,900...

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