Question 31

A U.S. Treasury bond will pay a lump sum of $1,000 exactly 3 years from today. The nominal interest rate is 6%, semiannual compounding. Which of the following statements is CORRECT?

Group of answer choices

The PV of the $1,000 lump sum has a smaller present value than the PV of a 3-year, $333.33 ordinary annuity

The present value would be greater if the lump sum were discounted back for more periods

The periodic interest rate is greater than 3%

The present value of the $1,000 would be larger if interest were compounded monthly rather than semiannually

Question 32

Last year Dania Corporation's sales were $525 million. If sales grow at 9.6% per year, how large (in millions) will they be 8 years later ?

Group of answer choices

$1,093.06

$1,300.74

$1,114.92

$994.68

Question 33

How much would $30,000 due in 50 years be worth today if the discount rate were 7.5%?

Group of answer choices

$806.67

$911.54

$621.14

$701.81