What is the maximum price that should be paid

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PART 1

A new financial product will give you a weekly return of 0.02% if you invest $250 weekly for three consecutive years. How much will you have after three years? (round to 2 dp)

Part 2

Lannister is planning to invest in a 15-year bond with a face value of $1,000 that pays a 5.5 percent coupon (paying semi-annually). Assume that coupon payments will be semi-annual. The current market rate for similar bonds is 4.5 percent. What is the maximum price that should be paid for this bond? Is the bond selling at a discount and why? (Round to 2 d.p)

Reference no: EM133057452

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