Question

On a 3 year fixed payment loan, the fixed payment equals $3,900 a year. If the interest rate on the loan is 6%, how much is the loan.

Question 19 options:

	$10,425
	$12,999
	$14,256
	$11,700

What is the price of a consol bond that has annual coupon payments of $7500, a an interest rate of 5%,

Question 28 options:

	$140,000
	$150,000
	$160000
	$7142

What is the price of a 3 year coupon bond with a coupon payment of $150 and a face value of $3000? The average rate of interest is 3%.

Question 35 options:

	$3169.72
	$3639.85
	$4500.36
	$3659.79

Answer 1

19)

Loan amount Px[1-(1:(1+r)^n)]=r Here, 6.0% 31 A Interest rate per annum B Number of years C Number of compoundings per per annum A:C Interest rate per period (r) BxC Number of periods (n) Payment per period (P) 1 6.0% 3 3,900.00 Loan amount $ 10,425 3900×(1-(1=(1+6%)^3)):6%

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