1. The current interest rates are at 8.50%. The bond you’re holding pays you $45 semi-annually for the next ten years. What is the present value of your bond, which has a maturity value of $1,000?

2. Your aunt Harriet recently inherited $100,000 and she is 75 years old. She’d like to see how much money she can take annually from the investment if it earns 8% (annually). Based upon her family genes, she thinks she will likely live to 90 years old. How much can she take from this investment annually if her estimates are correct?

Answer rating: 100% (QA)

1 Current interest rate 850 Maturity 10 Year Maturity value 1000 Coupon 45 ... View the full answer