Reference no: EM131964284

1. Sixty years ago, your grandparents opened two savings accounts and deposited $250 in each account. The first account was with City Bank at 3.6 percent, compounded annually. The second account was with Country Bank at 3.65 percent, compounded annually. Which one of the following statements is true concerning these accounts? (Do not round intermediate calculations.)

a. The City Bank account is currently worth $2,076.42.

b. The City Bank account has paid $48.19 more in interest than the Country Bank account.

c. The Country Bank account is currently worth $2,170.32.

d. The Country Bank account has paid $72.24 more in interest than the City Bank account.

e. The Country Bank account has paid $61.30 more in interest than the City Bank account.

2. Wachowicz Corporation issued 15-year, noncallable, 7.5% annual coupon bonds at their par value of $1,000 one year ago. Today, the market interest rate on these bonds is 5.5%. What is the current price of the bonds, given that they now have 14 years to maturity?