Question: please solve these problems without using excel and show all steps. Question No.2 Aurora purchased a newly-issued 30-year bond that pays semi-annual coupons at an

please solve these problems without using excel and show all steps. please solve these problems without using excel and show all steps. Question

Question No.2 Aurora purchased a newly-issued 30-year bond that pays semi-annual coupons at an 8% (annual) rate. The bond has a par value (and a redemption value) of 1,000. The bond is callable on or after its 15th anniversary with a 15% premium (i.e. 1,150 is payable if it is called). Aurora purchased this bond at issue at a price that will assure her a rate of return of at least 7.8% (a nominal rate, convertible semi-annually). If the bond is called on its 18th anniversary, what is Aurora's actual rate of return, convertible semi-annually? A. 8.035% B. 8.135% C. 8.235% D. 8.335% E. 8.345% Question No.3 Lawrence opens a bank account with $1,100 and lets it accumulate at an annual nominal interest rate of 4.2% convertible semiannually. Dennis also opens a bank account with $1,000 at the same time as Lawrence, but it grows at an annual nominal interest rate of 2.1% convertible monthly. For each account, interest is credited only at the end of each interest conversion period. Calculate the number of months required for the amount in Lawrence's account to be at least double the amount in Dennis's account. A. 348 B. 349 C. 354 D. 355 E. 360

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!