QUESTION 6 Sp You want to go to Europe 5 years from now, and you can save $7,300 per year, beginning one year from today You plan to deposit the funds in a mutual fund that you think will return 8.5% per year. Under these conditions, how much would you have just after you make the 5th deposit, 5 years from now? O A $50,608.61 OB. 551,906 27 O C346,715.64 O D.532,873.97 OE. 543,255,22 QUESTION 7 5 Suppose you inherited 5645,000 and invested it at a 25% per year. How much could you withdraw at the beginning of each of the ned 20 years O A $62439.53 O B. 556,87561 O C. 566,148 80 OD 561.821.31 O E. $59.966.67 QUESTIONS 5 Assume that interest rates on 20-year Treasury and corporate bonds are as follows: T-bond 7.72%6 AAA = 8.7256 A = 9.64% BBB = 10.18% The differences in these rates were probably caused primarily by O A Tax effects O 8. Default and liquidity risk differences OC. Maturity risk differences D. Inflation differences O E. Real risk-free rate differences QUESTIONS Assume that all interest rates in the economy decline from 10% to 9%. Which of the following bonds would have the largest percentage increasen price? O A. An 8-year bond with a 9% coupon OBA 1-year bond with a 15% coupon O CA3-year bond with a 10% coupon OD. A 10-year zero coupon bond O E A 10-year bond with a 10% coupon