. Calculate the following unknown quantities. (a) i = 0.04, m = 12. Find f to 3 decimal places. [ /2 ] (b) i = 0.02, m = 4. Find an equivalent annual interest rate to 3 decimal places. [ /2 ] (c) P = $1500, n = 10, S = $1750, semi-annual compounding. Find f. Round to 3 decimal places. [ /3 ] (d) f = 0.025, m = 4. Find the quarterly periodic interest rate.
A GIC with 5% compounded monthly is locked in for 5 years. If it was purchased for $5000, what is its maturity value? [ /2 ] (b) A 10-year strip bond has a face value of $50,000. The bond has an interest rate of 2.4% compounded semiannually. Find how much this bond was purchased for. [ /2 ] (c) A promissory note was established to pay off a debt of $6500 with interest accumulated at 3% compounded monthly. The note was paid off 2.5 years from today. How much was needed to pay off the note?
Answers
Calculate the following unknown quantities. (a) i = 0.04, m = 12. Find f to 3 decimal places. [ /2 ] (b) i = 0.02, m = 4. Find an equivalent annual interest rate to 3 decimal places. [ /2 ] (c) P = $1500, n = 10, S = $1750, semi-annual compounding. Find f. Round to 3 decimal places. [ /3 ] (d) f = 0.025, m = 4. Find the quarterly periodic interest rate.
A GIC with 5% compounded monthly is locked in for 5 years. If it was purchased for $5000, what is its maturity value? [ /2 ] (b) A 10-year strip bond has a face value of $50,000. The bond has an interest rate of 2.4% compounded semiannually. Find how much this bond was purchased for. [ /2 ] (c) A promissory note was established to pay off a debt of $6500 with interest accumulated at 3% compounded monthly. The note was paid off 2.5 years from today. How much was needed to pay off the note?