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You won a sports bet for $900 and decide to put your winnings into a 2-year CD that pays 2%/year with interest paid quarterly.
You won a sports bet for $900 and decide to put your winnings into a 2-year CD that pays 2%/year with interest paid quarterly. a. Draw a timeline of your CD investment from your perspective. b. How much will you have at the end of 2 years? 2. You lend $750 to a friend who promises to pay you $200 at the end of each of the next 4 years. Draw a timeline from your perspective. 3. If you can reliably earn 5% per year, what is the net present value (NPV) of the loan described in Q2? 4. You own a perpetual preferred stock issued by Sun Bank Corp. If the Sun Bank preferred pays a dividend of S.56 per year and today's market rate for this preferred is 2.2% per year, what is its current market price? 5. If the dividend of the Banc One preferred stock described in Q4 is scheduled to increase .5% per year, what is its current market price?
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