1. Suppose $1 were invested in 1776 at 3.3% interest compounded yearly. (a) Approximately how much would that investment be worth today? (b) What if the interest rate were 6.6%? 2. An 8% bond with 18...

12

Extracted text: 1. Suppose $1 were invested in 1776 at 3.3% interest compounded yearly. (a) Approximately how much would that investment be worth today? (b) What if the interest rate were 6.6%? 2. An 8% bond with 18 years to maturity has a yield of 9%, the coupon is paid annually and the face value is $100. What is the price of this bond? 3. A bond issued by Toyota has 30 years to maturity with a face value of $1,000. The yield to maturity for a similarly rated debt was 8.5% per annum. The coupon rate is 10.5%. Toyota pays interest to