Question
1. If you save $1000 per month for the next 10 years. How much will you be able to withdraw at the end of 10th
1. If you save $1000 per month for the next 10 years. How much will you be able to withdraw at the end of 10th year? The interest rate is 0.5% per month.
a. $17,703.
b. $163,979.
c. $9,730.
d. $90,073.
2. Which of the following is not a type of bond?
a. treasury bond.
b. corporate bonds. c.
College bonds. d.
foreign bonds.
3.If I invest 8,000 KD today at the rate of 10% per year, what is the amount that I will be able to withdraw yearly for the next 5 years?
a. 40,000 KD.
b. 12884 KD.
c. 1310.38 KD.
d. 2110.38 KD.
4. Which of the following risks that an ordinary bond is exposed to?
a. default risk.
b. inflation risk.
c. interest rate risk.
d. reinvestment rate risk.
5. A corporate bond issued in the UK has a coupon rate of 10% and face value of 100. The bond will mature in five years. The coupon payments are made annually. Calculate the price of the bond if the yield to maturity is 10%.
a. 116.85.
b. 100.
c. 117.81.
d. 96.72.
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