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Question : What is the present value of: 

A. $7,900 in 10 years at 11 percent? 

B. $16,600 in 5 years at 9 percent? 

C. $26,000 in 14 years at 6 percent? 

Question : What is the present value of: 

A. $7,900 in 10 years at 11 percent? 

B. $16,600 in 5 years at 9 percent? 

C. $26,000 in 14 years at 6 percent? 

Question : Exodus Limousine Company has $1,000 par value bonds outstanding at 10 per-cent interest. The bonds will mature in 50 years.

Compute the current price of the bonds if the percent yield to maturity is: 

A. 5 percent. 

B. 15 percent

Question : Based on bonds paying 10 percent interest for 20 years. Assume interest rates in the market (yield to maturity) decline from 11 percent to 8 percent:

a. What is the bond price at 11 percent?

b. What is the bond price at 8 percent?

c. What would be your percentage return on investment if you bought when rates were 11 percent and sold when rates were 8 percent?

Financial Accounting, Accounting

  • Category:- Financial Accounting
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