Question 4.a)The one-year and two-year zero rates are 1% and 2% respectively. Whatis the one-year forward one-year rate (that is,f11? Assume all rates are annuallycompounded. (This is a favorite question for interviewers. b) If the two-year forward one-year ratef21is 3%, what is the three-year zero rate
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Question 4.a)The one-year and two-year zero rates are 1% and 2% respectively. Whatis the one-year forward one-year rate (that is,f11? Assume all rates are annuallycompounded. (This is a favorite question for interviewers.
b) If the two-year forward one-year ratef21is 3%, what is the three-year zero rate
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- The 2-year zero-rate is 2.08% and the 2.5-year zero-rate is 4.4%. What is the forward rate for the six months after the second year? All rates are continuously compounded. (Round to the closest hundredths. Rates should be in percentage form. E.g. 9.99%)(......)???The 5-year spot rate is 10.5% and the 4-year spot rate is 8.8% What is the 1-year forward rate, 4 years from today? Provide your answer, in percent (%) correct to TWO decimal placesThe 3-year spot rate is 6.35%, and the 1-year forward rate two years from today is 5.26%. the 2-year spot rate is closest to A. 6.8992%. B. 6.4247%. C. 3.7299%. D. 3.2124%.
- All rates in this question use semi-annual compounding. You observe a two year spot rate of 5.10%, and a two to three year forward rate of 4.80%. What is the three year spot rate? 4.95% 5.06% 4.19% 5.00%10. What is the present value of $2,500 semiannual payments received at the beginning of each period for the next 10 years? The APR is 6%? (a) $38,309.50 (b) $37,194.70 (c) $35,809.50 (d) $36,884.80FOLLOWING QUESTIONS: 1. Consider that the number of periods and the amount of equal installment every year is the same with the given yet the prevailing market interest rate is 10%, how much would be the present value at 01/01/2020? A.973,684 B.1,088,815 C.1,217,105 D. 1,241,910 2. How much is the interest expense on December 31, 2020? A. 91,121 B. 108,143 C. 123,342 D. 136,913 3. How much is the interest expense on December 31, 2021? A. 108,143 B. 123,342 C. 136,913 D. 250,000 4. How much is the Present value at December 31, 2022? A. 600,459 B. 759,339 C. 901,195 D. 1,027,853 5. How many periods or equal installments to pay the Note Payable? A. 5 B. 6 C. 7 D. 8 6. How much is the annual installments? A. 200,000 B. 225,000 C. 250,000 D. 260,000 7. On 12/31/2020, the CURRENT PORTION of the Note Payable would be? A. 113,087 B. 126,658 C. 141,857 D. 158,879 PLEASE PROVIDE SOLUTIONS EVERY ANSWERS. THANK YOU!
- 6. Determine the present values if OMR5,000 is received in the future (i.e., at the end of each indicated time period) in each of the following situations: a. 5 percent for ten years b. 7 percent for seven years c. 9 percent for four yearsI have a question about calculating spot rates. In the task we're given five spot rates: r1 = 0.5%, r2 = 1.4%, r3 = 1.7%, r4 = 2.1%, r5 = 2.5% The task asks: "According to the current spot rates above, what is the two-year spot rate expected at the end of Year 1? In the solution the task is solved like this: (1.01733 / 1.005 )0.5 – 1 = 0.0231 or 2.31% My question is; What is the general formula in these type of cases?A2-5b This question consists of three parts. When performing the calculations, keep as many decimal places as you can for intermediate answers, but round your final answers to two decimal places. b. You have purchased a three-year inflation-indexed investment. This investment will pay you $X every six months, with each payment adjusted upward for inflation. Let’s say that the proposed first payment is $300 (before inflation adjustment), the average forecasted inflation rate will be 0.5% every six months for the next three years, and your required annual rate of return is 6% (compounded semi-annually). What is the present value of this inflation-indexed investment? (Hint: You cannot use a financial calculator to solve this problem.)
- If the one-year spot rate is 7 percent and the two-year spot rate is 8.5 per- cent, what is the one-year forward rate over the second year?4. Consider the following four alternatives: i. £132 received in two years ii. £160 received in five years iii. £200 received in eight years iv. £220 received in ten years What would be the ranking of the four alternatives from most valuable to least valuable if the interest rate is 7% per year? a iii, iv, ii, i b i, ii, iii, iv c iv, iii, ii, i d iii, i, ii, ivNOTE: Provide a format and show your work (example: N = 6, PV = XXX, I = X%, etc.) 1. Sam decides to start saving for retirement and she starts making $165 monthly contributions today and continue them for four years. What will Sam have at the end of the period if the compounding rate is 11.00 percent APR? (Do not round intermediate calculations and round your final answer to 2 decimal places.) 2.What annual rate of return is earned on a $5,000 investment made in year 4 when it grows to $11,000 by the end of year 10? (Hint. Construct a timeline. Do not round intermediate calculations and round your final answer to 2 decimal places.) 3. Given an 8 percent interest rate, compute the present value of payments made in years 0, 1, 2, 3, and 4 of $1,500, $1,600, $1,200, and $1,600, respectively. Compute using NPV.