1. Consider a 10-year bond issued by a corporation that pays a coupon of 6% anually. The current price of this bond is 685.45. What is the return that would be earned by buying and holding the bond until maturity?
2. You have been offered the opportunity to invest in a project that will pay $5,044 per year at the end of years one through three and $12,127 per year at the end of years four and five. If the appropriate discount rate is 13.7 percent per year, what is the present value of this cash flow pattern?