Fran wants to hire a diverse group of capable people to work at her brand new fitness studios. Unfortunately, many of the applic
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Answer:
YTM = 8%
Explanation:
$100 per year up to 4 years means, each year, the FV = $100.
We know, Zero coupon bond = [Fair Value ÷ ]
As the 4-year annuity paying the different YTM in the previous three years, 4th year YTM will be -
Bond value = +
+
+
or, $334.57 = $94.3396 + $87.3439 + $79.3832 +
or, $334.57 - 261.0667 =
or, = ($100 ÷ $73.50)
or, 1 + YTM =
or, YTM = 1.08 - 1
YTM = 0.08 or 8%
Answer:
$96,914
Explanation:
360‑day borrowing rate in Swiss as given is 5%
rate = 100 + 5 = 105%
Total = 200,000/105% = SF190,476
The spot rate of the Swiss franc is $.48
Therefore SF190,476 = SF190,476 × $.48 = $91,428
360‑day deposit rate in US as given 6%
Total Invest = 6 % of $91,428 + $91,428
= $5485.68 + $91,428 = $96,914
