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1. Use the following yield curve: Term in years Spot Rate Cash Flow WN 5.00% 5.75%...
(1.) Consider the following annualized spot yields: Maturity Annualized Spot Rate One Year 5.00% Two Years 5.50% Three Years 6.00% Four Years 6.00% Five Years ? (a.) Assuming the expectations theory of the term structure is correct, calculate the expected one-year interest rate one year from now (i.e. 1f2). (b.) Assuming the expectations theory of the term structure is correct, calculate the expected one-year interest rate three years from now (i.e. 3f4). (c.) Suppose a forecasting service predicts that th...
Consider the following 5-years investment table of Agus's cash flow with required return rate j=11% (RRR). Discounted is a discount factor based on RRR. Contribution is amount of money that Agus paid to start the business (investment). Whereas, return is amount of money that Agus received from the investment. Furthermore, PV Contrib is present value of Contribution based on RRR, then Net Cash Flow is Return minus Contribution. Moreover, Discounted Cash Flow is present value of Net Cash Flow based...
The current zero-coupon yield curve for risk-free bonds is as follows: 1 5 Maturity (years) YTM 5.00% 5.50% 5.75% 5.95% 6.05% What is the price per $100 face value of a four-year, zero-coupon, risk-free bond? The price per $100 face value of the four-year, zero-coupon, risk-free bond is $ . (Round to the nearest cent.)
Calculate x that makes the present worth of the following cash
flow at interest rate equals 10 % equals to $22222?
please in the fastest way and the easiest way
10000 2000 3000 4000 5000 X х X X 0 1 2 3 4 5 6 7 8
22) Consider the following timeline detailing a stream of cash flows: Date 23 $1000 $2000 $3000 $4000 Cash flow If the current market rate of interest is 5%, then the future value of this stream of cash flows is closest to:
1) (12 pts) The following is a cash flow diagram: Cash Flows: 20000 10000 Cash Flow $35,000 $5,000 $7,500 $1000 $10,000 $5,000 Year 0 1 2 4 >-10000 -20000 30000 40000 Years 4 Annual Interest rate = 10%, compounded annually a) Calculate the Present wortlh b) Calculate the equivalent annuity for these cash flows c) Calculate the future worth of these cash flows at 5 years
Question 6.12 You are given three investment alternatives to analyze. The cash flows from these three investments are as follows: End of year A B C 1 2000 1000 4000 2 3000 1000 4000 3 4000 1000 (4000) 4 (5000) 1000 (4000) 5 5000 3000 14000 What is the present value of each of these three investments if the appropriate discount rate is 9 percent?
15. Which of the following is CORRECT about the arbitrage-free price of a coupon bond? The sum arbitrage-free price of a coupon bond. The coupon of the present value of all cash flows (discounted at the required yield) is the A. B. C. The the present value of all cash flows (discounted at the spot rate of the bond's final term to maturity) is the arbitrage-free price of a coupon bond. of the present value of all cash flows (discounted...
You observe the following annually-compounded (periodicity of one) spot rate curve: Maturity (years) Spot Rate 1 5.65% 2 5.40% 3 5.10% 4 4.90% 5 4.75% A corporate bond with exactly 4 years until maturity pays a 5% annual coupon and is currently trading at a Z-spread of 75 bps. Based on the above spot rate curve, what is the value of the corporate bond per 100 of par?
1.) An investment in manufacturing equipment yields the following cash flows for 8 years. At the end of the 8th year the equipment can be sold for $15,000. Assuming an interest rate of 14% (compounded annually), how much would you be willing to invest in this manufacturing equipment? C=? I=2000 I=2000 I=2000 I=2000 I=1000 I=1000 I=1000 I=1000 L=$15,000 0 1 2 3 4 5 6 7 8 C: Cost, I: Income, L: Salvage Value 2.) Suppose that the nominal annual...