Question
1. Axim Corp bonds have a $1000 face value, pay a 5% coupon, make semiannual payments, have 8 years left to maturity, and are selling
1. Axim Corp bonds have a $1000 face value, pay a 5% coupon, make semiannual payments, have 8 years left to maturity, and are selling for $825.00 each. If Axim wants to sell new eight-year bonds today, what coupon must they set on the bonds so they may sell at par?
a. 6.00% | ||
b. 5.00% | ||
c. 4.00% | ||
d. 7.00% | ||
e. 8.00% |
2. You invest $4000 today and another $5000 a year from now. Your investments grow at a rate of 7.5%. What will be the total value of your investments at the end of 5 years from today? Choose the closest value.
a. $10,743 | ||
b. $12,921 | ||
c. $12,520 | ||
d. $12,420 | ||
e. $12,019 |
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