2. A 20-year bond has been added to Julias portfolio with the intention of being held for SIX YEARS. Currently, the 4% coupon, annual pay 20-year sells for 101.50(%) of par ($1,000).

Julias investment strategist has developed the following estimates:

1. In six years, 14-year bonds are projected to sell at 3.5(%) yield.
2. Short term re-investment rates for coupon payments are forecast at 2.25(%)

At the end of the holding period, the price of bond is projected to be _________ :

1. 1400.55
2. 1054.60
3. 1015.0
4. 959.21

Re-investment of coupons at 2.25(%) over the holding period will generate a future value of ___:

1. 500.25
2. 235.8
3. 253.91
4. 284.79

The total amount of money at the end of the holding period (6 years) is forecast to be _______:

1. 1015.0
2. 1054.6
3. 1800.66
4. 1308.51

The annual compound yield over the holding period is projected at ________:

1. 2.445
2. 4.324
3. 0.6303
4. 28.917