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Author Question: The rate of return earned on an investment of 50,000 today that guarantees an annuity of 10,489 for ... (Read 73 times)

CQXA

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on: Jul 10, 2018
The rate of return earned on an investment of 50,000 today that guarantees an annuity of 10,489 for six years in approximately:
 
  A) 5 percent
  B) 7 percent
  C) 30 percent
  D) 10 percent
  E) 12 percent

Question 2

Endicott Enterprises Inc. has issued 30-year semiannual coupon bonds with a face value of 1,000. If the annual coupon rate is 14 and the current yield to maturity is 8, what is the firm's current price per bond?
 
  A) 578.82
  B) 579.84
  C) 1,675.47
  D) 1,678.70


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bdobbins

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Reply #1 on: Jul 10, 2018
Answer to Question 1

B

Answer to Question 2

Answer: D
Explanation: D)
Bond Price = PMT  +
= 70  + = 1,678.70.
MODE = END, P/Y = 2, C/Y = 2
INPUT 60 8 ? -70 -1,000
KEY N I/Y PV PMT FV
CPT 1,678.70


CQXA

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Reply #2 on: Jul 10, 2018
TY


bdobbins

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Reply #3 on: Jul 10, 2018
Happy to Help


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