You're buying a home and the mortgage lender offers to let you pay a "point" $(1\%$ of the total loan$)$ to reduce your APR from $6\mathrm{.}5\%$ to $6\mathrm{.}25\%.$ The value of the loan without the point is $$400,000.$ It has a $30y$ r mortgage and monthly payments. If you plan on living in the house for $5$ years, should you do it$?$ Assume you can resell the house for $$430,000$

In $1975,$ interest rates were $7\mathrm{.}85\%$ and the rate of inflation was $12\mathrm{.}3\%.$ What was the real interest rate in $1975?$

How would your purchasing power of savings have changed over the year?

Which account do you prefer?

Earns $5\%$ annually for $3$ years

Earns $2\mathrm{.}5\%$ semiannually for $3$ years

Earns $7\mathrm{.}5\%$ every $18$ months for $3$ years

Earns $0\mathrm{.}41\%$ monthly for $3$ years

You're paying $$411\mathrm{.}41$ per month on a $6$ year car loan. The value of the loan is $$24,000.$ What is the annual interest rate being charged?

You're paying $$411\mathrm{.}41$ per month on a $6$ year car loan. The value of the loan is $$24,000.$ What is the annual interest rate being charged?

You gather the following information. Real risk free rate is $-2\mathrm{.}3\%.$ Expected inflation over the next $5$ years is $7\%,6\mathrm{.}5\%,5\mathrm{.}5\%,4\%,2\mathrm{.}5\%.$ The default risk premium for risky bonds is $0\mathrm{.}70\%.$ The liquidity risk premium is $0\mathrm{.}35\%.$ The maturity risk premium is equal to: $0\mathrm{.}125**(t-1)\%$

What is the nominal yield for the following bonds?

$2$ year Treasury

$5$ year Treasury

$1$ year Corporate

$3$ year Corporate

The nominal risk$-$free rate $(r[f])$

Treasury bonds of different maturities have the following yields. Calculate the forward rate for each future bond below.

$\backslash$table$[[$Year$,$vield$],[1,1\mathrm{.}85\%$