EC3332 Lecture 3 Practice Solutions 2022.pdf - EC3332 Money...

EC3332 Money and Banking I
Lecture 3 Practice Questions Solutions
Dr. Huang Kui, Angela
National Universtiy of Singapore
Practice Questions
The best way to solve yield to maturity questions involve the
following steps
1. Read the question and identify the type of credit market in-
strument being tested.
2. Identify the variables that are given
3. Identify the unknowns that need to be solved
4. Recall the appropriate formula
5. Substitute in the given values and obtain your answer
1. What is the monthly loan payment, for a 30-year home
loan, if i=6.5% and you would like to borrow $500,000?