Due February 25th, 2020 by 6:40P

Directions: Answer the following questions

1. Amrita has just received a $5,000 inheritance from her grandmother. She invests the money in her banks money market account which earns 4.5% stated annual interest (APR) compounded monthly.

a. After one year, what will be the total value in Amritas money market account? (0.3 pts)

b. Six months after investing her inheritance, Amritas car breaks down and needs $2500 in repairs. She decides to withdraw the money from her inheritance account to pay for the repairs. How much money will she have at the end of the year? (0.7 pts)

2. Suppose you purchased a shore house in Ocean Beach, NJ andyou took out a $200,000, 30-year loan with a 7% interest (paid annually). You have just made the payment. Given the financial situation in world markets you have now decided to pay the mortgage off by repaying the outstanding balance. What is the payoff amount if:

a. There are 10 years left on the mortgage (0.5 pts)

b. There are 15 years left on the mortgage (0.5 pts)

3. Prestige Worldwide LLC offers bonds with a coupon rate of 8.8 percent paid semiannually. The yield to maturity is 11.2 percent and the maturity date is 11 years from today.

a. What is the market price of this bond if the face value is $1,000?

b. Based on a, what is the bond price quote?

c. Is the bond priced at a discount or premium?