Question
21). MIKE just purchased bonds for $38 million that have a par value of $40 million, five years remaining to maturity, and a coupon rate
21). MIKE just purchased bonds for $38 million that have a par value of $40 million, five years remaining to maturity, and a coupon rate of 12 percent. It expects the required rate of return on these bonds to be 10 percent two years from now. At what price could Sun Devil Savings sell these bonds for two years from now?
a. 37,052,000
b. 30,052,000
c. 41,989,120
d. 11,937,120
22) . You are a business student graduate in 8 years, you would like to have $79,500 to buy new equipment for your business. What amount you should deposit now at 8% compounded twice a year.
a. 45,567
b. 56,596
c. 24,500
d. 42,445
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