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Please answer 5 and 6 You have inherited $10 Million from your rich uncle Jack. All of the sudden, everybody you know has come to

Please answer 5 and 6

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You have inherited $10 Million from your rich uncle Jack. All of the sudden, everybody you know has come to you with business ideas they are asking you to invest in. You have decided that three of these ideas are worth consideration: Project A: An investment of $1.5 Million at t=0 will yield a payoff of $1.875 Million at t=1 Project B: An investment of $1.2 Million at t = 0) will yield a payoff of $1.35 Million at t=1 Project C: An investment of $650 Thousand at t=0 will yield a payoff of $845 Thousand at t=1 1. For each project, calculate the NPV and decide whether you should invest if the interest rate is 15% and you can invest in as many of the projects as you wish (but cannot invest in the same project more than once) Answer the following questions about fixed-income securities. 1. A Treasury bill with a par value of $100,000 due three months from today is selling for $96,545. What is its effective annual yield? 2. You buy a $1000 par value 30-year zero-coupon bond issued at a yield to maturity of 12%. After one year, the prevailing interest rate has fallen to 10%. How much money do you make if you sell the bond after this year? 3. A coupon bond pays interest twice per year, has a par value of $1200, will mature in 10 years, and has an annual coupon rate of 10%. It's current yield to maturity is quoted at 15%. What is the price of this bond

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