0. You are considering a savings bond that will pay $700 in 15 years. If the interest rate is 2%, what should you pay today for the bond? You should pay $ (Round to the nearest cent.) for the bond.
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- You are considering a savings bond that will pay $100 in 10 years. If the interest rate is 2%, what should you pay today for the bond?You are thinking about buying a savings bond. The bond costs $50 today and will mature in 9 years with a value of $100. What annual interest rate will the bond earn? The bond will earn an annual rate of _____%. (Round to two decimal places.)Suppose that the interest rate is 10%. You are considering purchasing a bond that pays $25,000$25,000 in 6 years6 years . What is the net present value of the bond? value: $
- You are considering investing in a savings bond that will pay $50,000 in 6 years. If the competitive market rate is fixed at 6% per year, what is the bond worth today?You will receive $100 from a savings bond in 4 years. The nominal interest rate is 8.50%. a. What is the present value of the proceeds from the bond? (Do not round intermediate calculations. Round your answer to 2 decimal places.) b. If the inflation rate over the next few years is expected to be 3.50%, what will the real value of the $100 payoff be in terms of today’s dollars? (Do not round intermediate calculations. Round your answer to 2 decimal places.) c. What is the real interest rate? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) d. Calculate the real payoff from the bond [from part (b)] discounted at the real interest rate [from part (c)]. (Do not round intermediate calculations. Round your answer to 2 decimal places.)You want to buy a 9 year bond with a maturity value of $3,000, and you wish to get a return of 5.5% annually. How much (in dollars) will you pay? (Round your answer to the nearest cent.)
- Imagine that a $10,000 ten-year bond was issued at an interest rate of 6%. You are thinking about buying this bond one year before the end of the ten years, but the interest rate a savings account pays currently is 9%. Calculate what you would be willing to pay for this bond. Suppose that the savings account interest rate is not 9%, but 7%. How much would you be willing to pay for this bond now? Compare the value of this bond under two different interest rates.You will receive $100 from a savings bond in 3 years. The nominal interest rate is 8%. a. What is the present value of the proceeds from the bond? b. If the inflation rate over the next few years is expected to be 3%, what will the real value of the $100 payoff be in terms of today's dollars? C. What is the real interest rate? d. Show that the real payoff from the bond [from part (b)] discounted at the real interest rate [from part (c)] gives the same present value for the bond as you found in part (a).30. You will receive $100 from a savings bond in 3 years. The nominal interest rate is 8%. a. What is the present value of the proceeds from the bond? (Do not round intermediate calculations. Round your final answer to nearest cent.) b. If the inflation rate over the next few years is expected to be 3%, what will the real value of the $100 payoff be in terms of today's dollars?(Do not round intermediate calculations. Round your final answer to nearest cent.) c. What is the real interest rate? (Round your answer to 3 decimal places.) d. Show the real payoff from the bond in part (b), discounted at the real interest rate in part (c) gives the same present value for the bond as you found in part (a). (Do not round intermediate calculations. Round your final answer to nearest cent.)
- You have an opportunity to purchase a bond that will pay out $815 in 10 months. If you would like to earn at least a 2.2% annual rate of simple interest on your investment, what is the largest amount the you should pay for the bond? Round your answer to the nearest cent.You plan to invest in bonds that pay 3.25%, compounded annually. If you invest $10,000 today, how many years will it take for your investment to grow to $30,000?You are considering purchasing a bond. The bond will pay you $100 at the end of each year for 20 years. At the end of the 20th year, the bond will also pay you back its $1,000 face value. Assuming a 4% discount rate, how much is this bond worth today? Round to the nearest dollar.