Question
1.At the end of each of the past 10 years, Emily deposited $500 in an account that earned 3 percent compounded annually. How much is
1.At the end of each of the past 10 years, Emily deposited $500 in an account that earned 3 percent compounded annually. How much is in the account today?
2.Suppose John deposits $300 in an account at the end of this year, $400 at the end of the next year, $200 at the end of the following year. If his opportunity cost is 5 percent. How much will be in the account immediately after the third deposit is made?
3.Tracer Manufacturers issued a 10-year bond six years ago. The bond's maturity value is $1,000, and its coupon interest rate is 6 percent. Interest is paid semiannually. The bond matures in four years. a) If investors require a return equal to 5 percent to invest in similar bonds, what is the current market value of Tracer's bond? b) One year later(i.e. The bond matures in 3 years), the market price of the bond is $1,010. Compute the yield to maturity for the bond.
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