1. Garrett just financed some new furniture through his credit union. His loan requires the same payments of $300 a month for 5 years. Assuming that all payments are paid timely, his last payment will pay off the loan in full. What type of loan does Garrett have?

   		perpetual
   		amortized
   		lump sum
   		pure discount

4 points

QUESTION 20

1. The bond of Emerald Inc. has a 4 percent coupon and pay interest annually. Currently, the bond price is quoted as 90% of its face value. The bonds mature in 6 years. What is the yield to maturity?

   		4.81 percent
   		3.74 percent
   		5.22 percent
   		6.04 percent

2. You will receive annual payments of $5,000 at the end of each year for 10 years, but the first payment will be received in year 3. What is the present value of these payments if the discount rate is 12 percent?

   		$20,108.59
   		$22,387.13
   		$30,260.49
   		$28,251.12

3. You just received a credit offer in an email. The company is offering you $5,000 at 12 percent interest. The monthly payment is only $300. If you accept this offer, how long will it take you to pay off the loan?

   		18.32 months
   		25.63 months
   		19.39 months
   		23.10 months