Question 1:
A) Assume that you will deposit $4000 at the endof each of the next three years in a St. George bank account paying8% interest. You currently have $7000 in the account. How much willyou have in three years? In four years?
B) You are looking into an investment that willpay you $12,000 per year for the next 10 years. If you require a15% return, what is the most you would pay for thisinvestment?
C) A bond has an 8% coupon, paid semi-annually.The face value is $100, and the bond matures in 6 years. If thebond currently sells for $91.137, what is the yield to maturity?What is the effective annual yield?
I need proper calculation with justification whereasrequired.
