a. Compute the future value of $2,500 continuously compounded for 5 years at an APR of 9 percent. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. Compute the future value of $2,500 continuously compounded for 6 years at an APR of 7 percent. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. Compute the future value of $2,500 continuously compounded for 9 years at an APR of 4 percent. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) d. Compute the future value of $2,500 continuously compounded for 6 years at an APR of 10 percent. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
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Ответ:
a) $3920.78
b) $3804.90
c) $3583.32
d) $4555.30
Explanation:
To find future value, use the formula below:
where
A=future value
P=present value
r=rate of interest
n=time period.
e=2.71828
a)
=$2500*1.568312185
Future value =$3920.78
b)
=$2500 * 1.521961556
Future value =$3804.90
c)
=$2500 * 1.433329415
Future value =$3583.32
d)
=$2500 * 1.8221188
Future value =$4555.30
Ответ:
First bond new price= $921.53
Second bond new price =$801.05
Explanation:
a. Face value= future value= $1,000
Coupon rate= 5.90%
Coupon payment= 0.0590*1,000= 59
Time= 3 years
Yield to maturity= 9%
Enter the below in a financial calculator to calculate the present value of the bond:
FV= 1,000
PMT= 59
N= 3
I/Y= 9
The value obtained is 921.53.
Therefore, the new price of the bond is $921.53.
b. Face value= future value= $1,000
Coupon rate= 5.90%
Coupon payment= 0.0590*1,000= 59
Time= 10 years
Yield to maturity= 9%
Enter the below in a financial calculator to calculate the present value of the bond:
FV= 1,000
PMT= 59
N= 10
Interest rate per annum= 9
The value obtained is 801.05.
Therefore, the new price of the bond is $801.05.