Question
Suppose that $6500 is invested in a 5-year CD with an APY of 2.6%. Recall that this means the money must be left with the
Suppose that
$6500 is invested in a 5-year CD with an APY of 2.6%. Recall that this means the money must be left with the bank for 5 years, and they will guarantee an annual rate of return of 2.6%
What is corresponding APR?
A town wants to build a park for $600,000 and issues 600 bonds for $1000 each, with a term of 7years and a coupon rate of 6%. Consider the purchase of one such bond.(a)What is the total return of this investment?(b)What is the average rate of return?
Suppose that someone owns a 30-year $13,000 T-bond with a rate of 6%. After 7 years the bond is sold for cash, but interest rates have risen to 8.5%.(a )How much has the bond paid in total for the first 7years?(b)How much will the bond pay the person buying it over the next 23years?(c)How much is the bond currently worth?
Calculate the current yield on the described bond.A $1000Treasury bond with a coupon rate of 3.1%that has a market value of $800
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