What is the present value of the proceeds from the bond

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Question - You will receive $100 from a savings bond in 2 years. The nominal interest rate is 8.10%.

What is the present value of the proceeds from the bond?

If the inflation rate over the next few years is expected to be 3.10%, what will the real value of the $100 payoff be in terms of today's dollars?

What is the real interest rate?

Calculate the real payoff from the bond [from part (b)] discounted at the real interest rate [from part (c)].

Reference no: EM132982979

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