1) You have kept $10,000 toward the down payment on home. The money is invested in the account earning 7% interest. You will be ready to buy new home once your saving account increases to 25 thousand.
i) Around how many years it will take for account to reach $25,000?
ii) If interest rate doubles to 14% find the number of years that will pass before you reach your $25,000 target?
2) If yield curve is normal or upward sloping, short-term rates are higher than longer-term rates.
3) If market rate of interest on the bond is less than bond's coupon rate bond's present market price will be less than par (face).