Answer all of these questions with the right question number next to the correct choice. ANSWER ALL OR NONE

12)Due to the decrepit state of your 18-speed bicycle and the resulting derisive comments from random bystanders, you have opted to purchase new transportation. The local bike shop is offering a promotional sale in which you pay $1000 now and the remainder of the bike's price, i.e., $500, is due 5 years from now, while you pedal away today on one of the shop's finest Scorpian bikes. If you are able to earn 6% interest annually by loaning money to a friend, how much money would you need to invest today in order to have $500 in 5 years, assuming annual compounding, and pay off the bike?

A)$669.11

B)$391.76

C)$638.14

D)$373.63

13)What is the rate of return on a $500 investment that pays interest semiannually and will reach $1,000 in 7 years?

A)10.41%

B)9.94%

C)10.15%

D)5.08%

15)A Treasury bond yields an interest rate of 6% semiannually, whereas a 12-month T-bill pays 6% compounded annually. Which bond is the better investment?

A)T-bill

B)The assets are not comparable according to the Expectations Theory

C)The Treasury bond

D)The investments are equivalent