You want to save for retirement by making 20 equal annual contributions of $20,000/year starting next year. Unfortunately, you had to miss your 8th contribution. To compensate for this, you have decided to increase your contributions for the remaining 12 years (from t=9 till t=20). By how much you will have to increase your future contributions so that you will accumulate the same amount on your retirement account. Assume the annual interest rate (with annual compounding) is 8%.

Question 1 options:

	$1,666.67
	$3,480.29
	$2,653.90
	$2,037,04

You want to save for retirement by making equal annual contributions over the next 40 years and use your retirement savings to make equal withdrawals for 30 years after retirement. Assume you make your first withdrawal exactly 1 year after your last deposit. At t=15 you received a one-time bonus of $30,000 that you add to your retirement account in addition to your regular contributions. Assume you still plan to make 30 equal withdrawals. By how much your annual retirement withdrawals have been increased because of this extra contribution? Assume the annual interest rate (with annual compounding) is 8%.

Question 2 options:

	$2,664.82
	Cannot be determined from the available information
	$18,249.97
	$8,453.27

Find the Present Value of growing perpetuity with the first payment of $1000 at t=6 and a growth rate of 3%. No payments are made in years 1-6. Assume the annual interest rate (with annual compounding) is 8%.

Question 3 options:

	$15,670.52
	$12,603.39
	$13,611.66
	$14,924.31

By taking advantage of your current saving account and credit line promotions, you were able to borrow $100,000 at 2.5% APR compounded quarterly and deposit this money into a saving account that generates 2.5% APR compounded monthly. How much money will you have in 1 year after you withdraw money from your saving account and repay your debt?

Question 5 options:

	Between $10 and $50
	Less than $10
	More than $100
	Between $50 and $100

How an increase in interest rate affects bond prices?

Question 6 options:

	It increases the price of premium bonds and decrease the price of discounted bonds
	It decreases the price of premium bonds and increase the price of discounted bonds
	It decreases the price of both premium and discounted bonds
	It increases the price of both premium and discounted bonds

What can you say about a bond with YTM>YTC

Question 7 options:

	Most likely, it is overpriced.
	Most likely, it is underpriced.
	Most likely, it will not be called.
	Most likely, it will be called.