Last year, you bought a bond with face value $1000, maturity 15 years, coupon rate of 5.5% per year payable semi-annually and yield to maturity of 7% per year. Currently the bond sells for $900. How much would be your total yield if you sell this bond today? 13.71% 10.78%. (15.79%) (17.84%)

Consider a 10 year bond which pays 6% coupon semi-annually and has a yield-to-maturity of 7%. How much would the price of bond change if investors required return increases to 8% per year?

increase by approximately $54

decrease by approximately $65

decrease by approximately $52

increase by approximately $125

Consider the following two bonds issued by a corporation: (i) Bond A with 6% coupon and 10 years of maturity and (ii) Bond B with 6% coupon and 4 years of maturity. What would happen to the prices of these bonds if interest rate in the economy decreases by 0.5%?

Price of Bond B will increase more than price of Bond A

Price of Bond A will increase more than price of Bond B

Price of Bond A will fall more than price of Bond B

Price of Bond B will fall more than price of Bond A

Consider the following two bonds issued by a corporation: (i) Bond A with 6% coupon and 10 years of maturity and (ii) Bond B with 9% coupon and 10 years of maturity. What would happen to the prices of these bonds if interest rate in the economy increases by 0.5%?

Price of Bond A will increase more than price of Bond B

Price of Bond A will fall more than price of Bond B

Price of Bond B will fall more than price of Bond A

Price of Bond B will increase more than price of Bond A

Bill and Cathy will be retiring in fifteen years and would like to buy an Italian villa. The villa costs $500,000 today, and housing prices in Italy are expected to increase by 6.5% per year. Bill and Cathy wants to deposit an equal amount at the end of every year so that they can buy this villa in 15 years. If their account earns 10% per year, what is the amount of each deposit? $53,176 $169,065 $37,714 $40,473 Bill and Cathy will be retiring in fifteen years and would like to buy an Italian villa. The villa costs $500,000 today, and housing prices in Italy are expected to increase by 6.5% per year. Bill and Cathy wants to deposit one lump sum amount today. If their account earns 10% per year, what is the amount of this deposit?

$372,623

$119,696

$286,858

$307,839