1. A music composer deposits $4,000 into an investment that earns an annual interest rate of 5.2%. If the current rate of inflation is 1.9%, what is the real rate of return on the investment? Round to the nearest hundredth of a percent.

b. Carley Montoya invests $9,500 into a mutual fund for which the transaction fee is 5%. If the net asset value per share of the fund is $39.26, how many shares can Carley purchase? Round to the nearest thousandth.

 c. Suppose a bond with a par value of $1,000 has coupon of 1.85%. What is the nominal value (in dollars) of the bond if the current interest rate is 3.35%? Round to the nearest dollar.

d. What is the compound amount (in dollars) when $6,800 is deposited in an account earning an interest rate of 6%, compounded quarterly, for 10 years?

Answer rating: 100% (QA)

a The real rate of return on the investment can be calculated using the formula Real Rate of Return ... View the full answer