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1- The government of England has decided to issue a bond which has face value of...

1- The government of England has decided to issue a bond which has face value of 1,200$ and maturity of three years. The government has announced that it won’t make any coupon payments to the lenders. If the yield to maturity is 5.8%, how much the investors should pay for the bond?

2- You are planning to set up a deposit account and invest 500$ every month for the next six months. According to the strict policies of your bank, your deposit account will be compounded semi-annually. If the relevant interest rate is 7% and if your first deposit payment occurs today, what will be the value of your account at the end of the investment period?

3- Btech corp. has announced that it will distribute 2$ dividend two years from now. The company also plans to distribute a 5$ dividend after three years of it’s first dividend payment. If the required rate of return is 13% and if the predicted selling price in year 5 is 30$, how much the stock should worth right now?

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jeff jeffy answered 2 years ago
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