Question: I really need help figuring out how to do this. Please let me know 1. John is considering starting up a new business venture 5
I really need help figuring out how to do this. Please let me know

1. John is considering starting up a new business venture 5 years from now. First, John wants to make some money via a sound Real Estate investment. John finds a deal where he can buy property today for 53 million and sell it in 5 years for 54 million. If the going interest rate is 8% compounded annually, what is the land worth (present value) today? 2. Should John buy it for $3 million dollars? Why or why not? 3. Later, John finds out he can rent the property for 200,000 per year and still sell it for $4 million dollars five years from now. Should John buy the property if he can rent it and then sell 5 years later? 4. Why or why not? John also wants to invest in some bonds in an effort to diversify his investment portfolio. He is looking at two bonds in particular - both bonds have a par value of $1000; -A Tim Horton's Bond has a coupon rate of 8%, the coupon pays annually, 10-year maturity and sell at a yield to maturity of 10%. -A Google Inc. Bond has a coupon rate of 12%, the coupon pays annually, 10-year maturity and sell at a yield to maturity of 10%. 5. If their yields to maturity are still 10% one year from now, what is the rate of return on each bond? 6. Which bond should John choose if he is basing his decision on the bond's rate of return only? 1. John is considering starting up a new business venture 5 years from now. First, John wants to make some money via a sound Real Estate investment. John finds a deal where he can buy property today for 53 million and sell it in 5 years for 54 million. If the going interest rate is 8% compounded annually, what is the land worth (present value) today? 2. Should John buy it for $3 million dollars? Why or why not? 3. Later, John finds out he can rent the property for 200,000 per year and still sell it for $4 million dollars five years from now. Should John buy the property if he can rent it and then sell 5 years later? 4. Why or why not? John also wants to invest in some bonds in an effort to diversify his investment portfolio. He is looking at two bonds in particular - both bonds have a par value of $1000; -A Tim Horton's Bond has a coupon rate of 8%, the coupon pays annually, 10-year maturity and sell at a yield to maturity of 10%. -A Google Inc. Bond has a coupon rate of 12%, the coupon pays annually, 10-year maturity and sell at a yield to maturity of 10%. 5. If their yields to maturity are still 10% one year from now, what is the rate of return on each bond? 6. Which bond should John choose if he is basing his decision on the bond's rate of return only
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