1. Your Grandma is giving you $270 a month for 6 years while you are in your study abroad program. At a 8 percent discount rate, what are these payments worth to you when you leave the country for that program?
2. You are offered an investment that will pay you $1239 per month for next 16 years. Assuming you want to earn an 7.67% rate of return, what is this investment worth today? Round to the nearest cent.
3. Calculate the yield to maturity (YTM) for a one-year coupon bond with a purchase price of $80, a face-value of 1,000, and a current yield of 10%.
Please show how you got to the answer and the the values for FV, PV, PMT, I and N as applicable.