Objective questions on time value of money


Question1. Kimberly is considering an investment of 2,000 dollars each year for fifteen years. The investment will pay eight percent interest. How much will this investment be worth at the end of the fifteen years?       

[A] $46,728.13

[B] $54,304.23

[C] $58,648.57    

[D] $31,441.27

[E] $31,650.87         

Question 2: A 6% 1,000 dollars bond matures in four years, pays interest semiannually, and has a yield to maturity of 6.85%. Calculate the current market price of the bond?                                          

[A] $869.15

[B] $910.27

[C] $970.69

[D] $768.76

[E] $801.38

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Finance Basics: Objective questions on time value of money
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