3. The present value of the bond if overall rates in the market decreased by 2% annually $ 0 Number of semi-annual payments made over 10 years = (10 X 2) Present Value PV Periods Interest N I Payments Future Value PMT FV $ $ Arachnoid Fina Once you h on your Wo = % New annual market interest rate paid semi-annually = (New Annual Rate divided by 2) This bond makes regular semi-annual payments of interest (in dollars) (Dollars Paid Annually divided by 2 and Never Changes) |Future value in 10 years enter as a positive number = ( Always the Future or Face Value of the Bond and Never Changes) 4. The present value of the bond if overall rates in the market remained the same as at issuance $ 0 Number of semi-annual payments made over 10 years (10 X 2) Present Value PV Periods Interest N I % Annual market interest rate remains the same as Question 1, paid semi-annually (Annual Rate divided by 2) Payments PMT $ Future Value FV $ |This bond makes regular semi-annual payments of interest (in dollars) (Dollars Paid Annually divided by 2 and Never Changes) Future value in 10 yearsenter as a positive number (Always the Future or Face Value of the Bond and Never Changes)