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Unformatted text preview: 83.63 – 42000 = $27083.63
2.) A 30year $10,000 US Treasury Bond is quoted at 97.5 points with a current yield of 7.5%. Find the
annual interest payment. (2 points)
annual interest = current yield ¥ current price
current price = 10000 ¥ 0.975 = 9750
annual interest = 0.075 ¥ 9750 = $731.25
3.) Melissa buys 100 shares of XYZ stock for $50.25 per share. Eight years later she sells them for $62.45
per share and pays a commission of $0.50 per share on the sale.
a) Find the total return. (1.5 points)
Total return = gain in value ÷ purchase price (similar to (AP) ÷ P)
Tot...
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 Fall '08
 WOOLAND

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