Question

1. If you purchase a home and borrow $500,000, with an interest rate of 5% and a term of 30 years, what is the payment? 2. If you need a permanent stream of income amounting to $100,000 per year, how much do you need to endow if the discount rate is 7%? 3. You purchase a $50,000 car, and put down 20%. With an interest rate of 5% and a term of six years, what is the payment? 4. A bond has a par value of $5,000. It is a 30-year bond and pays an annual coupon of $85. What is the Yield to Maturity of the bond if the market price is $4,250? 5. You purchase a 20-year bond today for $1,000. It has a par value of $750. If the bond pays a coupon of $50 twice per year, what is the Yield to Maturity of the bond?

          1. If you purchase a home and borrow $500,000, with an interest rate of 5% and a term of 30 years, what is the payment?
2. If you need a permanent stream of income amounting to $100,000 per year, how much do you need to endow if the discount rate is 7%?
3. You purchase a $50,000 car, and put down 20%. With an interest rate of 5% and a term of six years, what is the payment?
4. A bond has a par value of $5,000. It is a 30-year bond and pays an annual coupon of $85. What is the Yield to Maturity of the bond if the market price is $4,250?
5. You purchase a 20-year bond today for $1,000. It has a par value of $750. If the bond pays a coupon of $50 twice per year, what is the Yield to Maturity of the bond?

Added by Anthony J.

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