Mathematics Homework Help. CUNY Bernard M Baruch College Market Value of The Bond Questionnaire
I’m working on a mathematics multi-part question and need an explanation and answer to help me learn.
Assume Mr. Smith has reached retirement and has $250,000 in an account which is earning 6.5%. He would now like to make equal monthly withdrawals for the next 15 years to completely deplete this account. Find the withdrawal payment.
A ten-year $1,000 bond pays $35 every six months. If the current interest rate is 8.2%, find the fair market value of the bond.
- Hint: You must do the following.
- Find the present value of $1000.
Find the present value of the $35 payments.
The fair market value of the bond = a + b
- An amount of $200,000 is borrowed for 5 years at a rate of 12%. Make an amortization schedule showing the quarterly payment, the quarterly interest on the outstanding balance, the portion of the payment going toward reducing the debt, and the balance.
- Jane plans to buy a house in 10 years. The house she dreams about costs about $150,000 today. The cost of houses increases at 2.5% per year.
- How much will the house cost in ten years?
Jane currently has $75,000 that she can invest to earn 3% interest over the next ten years. How much will Jane accumulate from her investment of 75,000 Dollars in ten Years?
- How much additional money would Jane need in ten years? In effect, how much money does Jane need to borrow to purchase her house?
- Prepare an amortization table to pay off Jane’s mortgage, if she can borrow at an annual rate of 6.5% to pay off the mortgage quarterly in 5 years after buying the house
