C
show work 26) By Marks buys a one-year German government bond (called a bund) for $400....
show work 35) By Marks buys a one-year German government bond (called a bund) for $400. He receives principal and interest totaling $436 one year later. During the year the CPI rose from 150 to 162. The nominal interest rate on the bond was and the real interest rate was A) 9%; 1% B) 9%;-196 C) 36%,24% D) 36%; 12%
Hy Marks buys a one-year government bond on January 1, 2015 for $500. He receives principal plus interest totaling $527.5 on January 1, 2016. Suppose that the CPI is 200 on January 1, 2015, and 205.0 on January 1, 2016. This increase in prices is different than Hy had anticipated his guess was that the CPI would be at 201.0 by the beginning of 2016. The nominal interest rate is 5.5%. (Round your answer in percentage points to one decimal...
A 29-year German government bond (bund) has a face value of €150 and a coupon rate of 4% paid annually. Assume that the interest rate (in euros) is equal to 7.90% per year. What is the bond's PV?
1. A risk-free bond has a $200 face value in one year and the nominal interest rate is 7%. What is the price of the bond today? 2. A risk-free bond has a face value of $500 in one year, the price of the bond today is $472. a. What is the rate of return (yield) on the bond? b. If the expected rate of inflation is 2%, what is the real interest rate? 3. a. Show the supply and...
1 23 You are given the following information about an economy: Gross private domestic investment 50 Government purchases of goods and services 35 Gross national product (GNP) 300 Current account balance10 Taxes 60 Government transfer payments to the domestic private sector 30 Interest payments from the government to the domestic private sector10 (Assume all interest payments by the government go to domestic households.) Factor income received from rest of world 6 Factor payments made to rest of world8 Assuming that...
Consider two bonds, one issued in euros () in Germany, and one issued in dollars (S) in the United States. Assume that both government securities are one-year bonds-paying the face value of the bond one year from now The face values and prices on the two bonds are given by Face Value $10,000 10,000 Price $9,615.38 €3,345 79 United States Germany Compute the nominal interest rate on each of the bonds. bond-||% Nominal interest rate on the US (Enter your...
6. A one-year risk free bond with a face value of $500 has a price of $470. The expected inflation rate is 2%. What is the real interest rate and what is the nominal interest rate?
Please do the first one, the second one is correct 1 2 The velocity of circulation is growing at 4percet a year, the real interest rate is 2percent a year, the nominal interest rate is 7 percent a year and the growsh rate of real GOP i 3 percent a year Calculate the inflation rate, the growth rate of money, and the growth rate of nominal GDP The inflation rate is 5 percent a year. The growth rate of money...
18. Bill buys a 10-year 1000 par value 6% bond with semi-annual coupons. The price assumes a nominal yield of 6%, compounded semi-annually. As Bill receives each coupon payment, he immediately puts the money into an account earning interest at an annual effective rate of i. At the end of 10 years, immediately after Bill receives the final coupon payment and the redemption value of the bond, Bill has earned an annual effective yield of 7% on his investment in...
PLEASE HELP WITH QUESTION 6,7,8 THANK YOU! PART 1Introduction c. A homemaker enters the workforce, taking a job year (a few years ago), the production and price da ta that will pay $40,000 over the year. The home were as follows: maker must pay $16,000 over the year for profes- Quantity 3000 bags 6000 bunches 8000 bags Fruit Price sional child care services Apples Bananas ag d. A Japanese company builds an auto plant in Tennessee for $100,000,000, using only...