Question
NOTE: Please use Excel for Excel Formulas 7. You receive $5,000 per year for the next 20 years from your Grandmothers trust. If a 7%
NOTE: Please use Excel for Excel Formulas
7. You receive $5,000 per year for the next 20 years from your Grandmothers trust. If a 7% interest rate is applied, what is the present value of the future payment?
8. If you deposit $5,000 per year for the next 20 years into an account paying 10%, how much money will you have in the account in after the 20 years? Suppose you decide to invest this $5,000 per year in the same account earning 10% for 40 years rather than 20, how much will you have in the account after 40 years?
9. The River Corp. issues a bond with a par value of $1,000. The bond will mature in 10 years and has a coupon rate of 5% paid annually. If the yield to maturity is 8%, what is the current price of the bond?
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