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Year 3 return on investment is R45000, year 6 return is R90000, year 9 return is R115000. Interest rate is 11.59% and present value of outflows is R95000. what is the future value of cash inflows?
Consider Bond XYZ
Coupon rate: 9,75% per year
Yield to maturity: 11,4% per year
Maturity date: 15 April 2047
Settlement date: 29 November 2021
The clean price is
Find the accumulated value of an ordinary simple annuity of Rs 3 000 per year for 7 years, if money is worth j1=8%
26.
An investment of $15,000 is made for three years at 4.5%
compounded quarterly.
a)
Determine the maturity value of the investment.
b)
What is the amount of compound interest earned on the
investment?
Determine the future value of a $5,000 compound-interest Canada Savings Bond at 8.5%/a, compounded annually after each amount of time.
4 years
factors are given as
u = e^(σ sqrt(h))
, d = e^(−σ sqrt(h))
,
where σ denotes the volatility parameter and h stands for the length of a single period
in a tree.
3.1.1 What is the ratio Su/Sd? [2]
3.1.2 What is the (as simplified as possible) expression for the risk-neutral probability
of the stock price going up in a single step? [2]
3.2 Find the current price of a one-year, R110-strike American put option on a non-
dividend-paying stock whose current price is S(0) = 100. Assume that the continuously compounded interest rate equals r = 0.06. Use a two-period Binomial tree with
u = 1.23, and d = 0.86 to calculate the price VP(0) of the put option.
