A bakery is considering the purchase of new machine that will produce 3 times faster than
the current one. The cost of the machine is $20,000 with a 4 years useful life, and it is estimated to
produce 4000 bakes each year. To produce one bake, it will cos
1- If Jack going to deposit $5000 in his bank account with an annual interest rate of 12% for 4 years,
what is the sum of the mount is he going to receive at the end of that period?
FVSS= PV CF r,t
= 5000 1.5735
FVSS= $7,867.50
What if the interest rate i
1- You have 7% coupon rate with a face value of $1000. The bond matures in six years. The market
rate is 10% and the coupon is paid annually.
What is the current price of the bond?
Bond Value = Present value of the coupon + present value of the face amoun