5) Al obtained a mortgage of $195,000 at 5.25 percent for 15 years. How much of second monthly payment is applied to interest? A) $850,00 B) $849.16 C) $852.09 D) $848.08 E) $853.13 E) $8571 6) The 7 percent bonds issued by Modern Kitchens pay interest semiannually, mature in eight years, and have a $1,000 face value. Currently, the bonds sell for $987. What is the yield to maturity? A) 7.43 percent B) 6.92 percent C) 6.88 percent D) 6.97 percent E) 7.22 percent 7 7) Southern Tours is considering acquiring Holiday Vacations. Management believes Holiday Vacations can generate cash flows of $218,000, $224,000, and $238,000 over the next three years, respectively. After that time, they feel the business will b worthless. If the desired rate of return is 14.5 percent, what is the maximum Tours should pay today to acquire Holiday Vacations? A) $538,615.08 B) $538,407.71 C) $595,170.53 D) $545,920.61 E) $519,799.59 8) _ 8) Global Exporters wants to raise $31.3 million to expand its business. To accomplish this, it plans to sell 15-year, $1,000 face value, zero coupon bonds. The bonds will be priced to yield 5.75 percent. What is the minimum number of bonds it must sell to raise the money it needs? Assume semiannual compounding. A) 74,907 B) 69,800 C) 86,029 D) 73,225 E) 80,411 9) 9) You want to buy a house that costs $285,000. You will make a down payment equal to 20 percent of the price of the house and finance the remainder with a loan that has an interest rate of 5.49 percent compounded monthly. If the loan is for 30 years, what are your monthly mortgage payments? A) $1293.13 B) $1357.79 C) $1250.02 D) $1305.86 E) $1287.24