1. Find the present value of $4,000 to be received 10 years from today if the interest rate is:

a. 1% per month. 1,211.98

b. 12% compounded weekly. 1,206.44

2. You owe $2,000 on your credit card. The interest rate they offer is 19.6% interest compounded monthly. If you can only make the minimum monthly payment of $40 per month, how many years will it take for you to be debt-free? 8.73

3. You will make $200 deposits every week into a retirement account for the next 20 years until you retire. If the account offers 0.15% per week, how much will you have in 20 years? $500,434.96

4. The current rates on Treasury securities are as follows: ₁R₁ = 4.33%, ₁R₂ = 5.25%, ₁R₃ = 5.55%, and ₁R₄ = 6.01%. If the unbiased expectations theory holds, what does the market expect the one-year Treasury rate to be three years from now? 6.15%

5. You open the WSJ and see that bonds for your firm will mature 8 years. The yield is 5.24% and the last price is $932.55. If these bonds pay semiannually, what is the coupon rate? 4.197 %

6. Suppose you buy a TIPS bond with a 5% coupon rate, 18 months to maturity, pays semiannually, and a YTM of 3.3%. The CPI is currently 275.2. It will increase to 288 in 6 months, to 291 in 12 months, and to 294 in 18 months. Calculate the price of this bond. 1093.88

7. You own a convertible bond that has a 6% yield, 4.5% coupon rate, pays semiannually, and has 3 years to maturity. The conversion rate is 8. The current stock price is 127.3. Calculate your gain or loss if you decide to convert. Gain, 59.03