A long time ago, your Uncle put aside some money in a savings account that you are bound to receive on your 30th birthday (in 5 years). He doesn’t like taking risks, so his savings instrument of choice has always been the bank term deposit.

He just locked the money, currently $14704.76, in for one last 5-year term at the local bank at a rate of 8%. 

Your Uncle actually funded the account by a lump sum payment some 15 years ago. He first locked the money into a 5-year term deposit at  8%. After that, he renewed for another 5-year term at 9.5%, and then another at 6%. How much money must he have deposited 15 years ago?

 Please round to 2 decimal places and DO NOT include $.

You are considering purchasing a corporate bond for $200 today. The bond will mature in 12 years with a value of $400.

Required: What annual interest rate will the bond earn?

All answers to 2 decimal places ( 2dpi) and do not include %.

Consider the following timeline detailing a stream of cash flows:

If the current market rate of interest is 10%, then the present value (PV) of this stream of cash flows is closest to:

Consider the following timeline:

If the current market rate of interest is 9%, then the present value (PV) of this timeline as of year 0 is closest to:

$12 500 is invested in a certain business at the start of a year, in return the investor will receive $3 000 at the end of each of the next five years. What is the net present value of this business opportunity if the interest rate is 5% per year?

A homeowner in Queensland has the opportunity to install a solar water heater in her home for a cost of $3 000. After installation, the solar water heater will produce a small amount of hot water every day, forever, and will require no maintenance. How much must the homeowner save on water heating costs every year if this is to be a sound investment? (The interest rate is 8.5% per year.)

Your parents invested money in a term deposit 15 years ago, and the current balance is $5,500. You will receive this amount on your 21st birthday, which is 5 years from now. The final 5-year term is locked at 3.25%.

Prior to that, they locked the money into a 5-year term deposit at 7.75%, then renewed it for another 5-year term at 6.25%, and finally locked it at 4.5%. How much did they initially deposit 15 years ago?

 Please round to 2 decimal places and DO NOT include $.

You are currently entering university and you

want to buy your uncle’s car when you graduate. He has promised to sell it to

you for $18 000. How much will you have to deposit now, in an account earning

8%, to have enough money buy the car in 4 years?

Your best friend, Simon, has offered you an investment opportunity that requires an initial investment of $2,500 today and will grow to $3,000 in one year. If interest rates in the bank average 5%, what is the premium Simon is offering (in percentage terms) with his investment opportunity?

Please round to 2 decimal places .

A risk-free, zero-coupon bond with a face value of $1 000 has 15 years to maturity. If the YTM is 5.8%, which of the following would be closest to the price this bond will trade at?