Financial Math Answers

B1 - A two year bond with a nominal rate of 3.5% per annum

these bonds have six monthly coupons and a face value of $2,000. Calculate their present values, Macauly durations and convexities using a YTM of 6% (YTM = 0.06).

B1 - A two year bond with a nominal rate of 3.5% per annum

these bonds have six monthly coupons and a face value of $2,000. Calculate their present values, Macauly durations and convexities using a YTM of 6% (YTM = 0.06).

(a) Calculate both the average discrete and average continuous monthly returns for the following dividend adjusted share price and market index.

Share Price Market Index
Date Rit Rmt.

August-17 $1.55 1,175.00
September-17 $2.10 1,200.00
October-17 $2.45 1,305.00
November-17 $2.85 1,505.00

A pension fund must pay $10,000 at the end of each of the next five years. Find the Present Value and Duration for this set of payments using a discounted rate of 0.06 or 6 %.

You are purchasing a car for $12,465.00 plus 5.65% sales tax. You make a $1,300.00 down payment and have a fair credit score. If you improved your credit score to good and paid $1,500 on your purchase, how much interest could you save in the first month?

Your friend has prepared his monthly budget and asks you if he has overlooked anything in this planning.
Which of the following questions points out his most serious omission?

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a.
What if your income from stocks is lost?
b.
What if you need to go to the doctor?
c.
What if the electric bill increases?
d.
What if you need to replace the furnace?

the simple interest rate which is equal rate of 12% per year for a period of 18 months is

You invest R20000 at rate of 10% per annum After how many years will investment grow to value of R28 000 if interest earned is compounded?

Alistar has an annual income of $25,000. He decides to take classes on line and at night so that he can continue to work. After 3 years he gets his degree and immediately starts earning $32,000 per year. If it takes Alistar 6 years to recover his investment for his education, how much did it cost him?
a.
$21,000
b.
$42,000
c.
$63,000
d.
$150,000

You consider buying a business for R600 000. The business is expected to run for 5 years and the following net returns are expected..

Year 1- R160 000
Year 2- R250 000
Year 3- R190 000
Year 4- R180 000
Year 5- R130 000

Should you buy the business? A project of this type is expected to return at least 11% per annum. (Show details of your calculation)