- A month from now, you plan to begin saving for your retirement by making a deposit into a new savings account that has an expected return of 5% compounded monthly. You plan to continue depositing the same amount each month until you retire in 35 years. You expect to make withdrawals in the amount of $15,000 from your savings account every year for 40 years after you retire. Assume you were asked to find the amount you will need to deposit into your savings account each month until you retire in order to fund your retirement. In your solution, you would need to use the annuity present value equation to find the present value at your retirement date of the withdrawals you expect to make each year during your retirement. What interest rate would you use in this equation?

- A bond pays a 3% coupon and makes semi-annual payments. The bond has 20 years to maturity and a YTM of 8%. What is the current bond price?

- A bond with 10 years left to maturity currently sells for 90% of par value. If the bond makes a $60 annual coupon payment, then the bond must have a YTM greater than what percentage rate?

- A company has decided to issue 25-year zero-coupon bonds to raise funds. The required return on the bonds will be 7% and face value will be $1,000. What will these bonds sell for at issuance?