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(a) Determine the future value of the following cash flows at the end of year 20 with an annual interest rate of 18% compounded monthly

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(a) Determine the future value of the following cash flows at the end of year 20 with an annual interest rate of 18% compounded monthly $200 is annual payment for 20 years 0 1 2 3 20 Year |||||||||| 0 $200 $200 $200 200 (b) You are evaluating a 10-year, $1,000 par value bond. Its coupon rate is 8%, and the coupon is paid quarterly. If you require an effective annual interest rate of 10%, how much should you pay for the bond (keep 2 decimal places in % workings: i.e. x.xx%)

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