A/ You are borrowing $45,000 for a new car and are quoted an effective annual rate of 6% on a 5 year loan. What are your monthly payments? What is the principal and interest of the first months payment? If you decided to sell the car after 4 years, what would be the loan balance youd owe the bank?

B/ My company wishes to do a new bond issue and raise $400 million. The bond offering will be a $700 million face value 10 year bond issue with 6.5% semi-annual coupons. What is the yield to maturity on the bond issue?