Question
1.a) What is the present value of a risk-free bond that pays $250 in the following year? Assume the risk-free rate is 4%. (Write your
1.a) What is the present value of a risk-free bond that pays $250 in the following year? Assume the risk-free rate is 4%. (Write your answer as a number rounded to 2 decimal points. For example, if your answer is $22.56789, write 22.57)
b) Suppose you invest $1,000 today and will receive $10,000 in twenty years. What is your IRR? (State your answer as a number rounded to three decimal points. For example if your answer is 3%, write 0.030)
c)How much money will you have in 20 years if you deposit $100 today at 7% annual interest? (Write your answer as a number rounded to 2 decimal points. For example, if your answer is $22.56789, write 22.57)
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