I have already done these but I just want see if I got the same answers as someone else

1. a makes b a $1000 loan. B agrees to pay A at end of 2 years. calculate A's yield to maturity on this loan

2. after 1 year A needs money. C agrees to pay A $1050 for the loan to B, calculate A's rate of return for the one year they held the loan. Calculate C's yield to maturity for the remaining 1 year on the loan. What does this imply about how interest rates changed between the time A made the loan and the time they sold it to C

3. You buy a share of stock for $1000 at the end of the year you get a dividend of $50 after which you sell the stock for $900. what is your return on investment

4. you put $1000 into a saving account which earns 10% interest per year. you dont make withdrawals, how much do you have after 2 years?

will send fg to first person to reply with answers. If my answer doesnt match yours I'll tip some extra fg if you can explain how you got the answer to me.

thanks

4 depends on how interest is calculated ...

Assuming its compounded annually , 1000 x 1.1 is 1100 then 1.1 x 1100 is 1100 is 110 so 1210 dollars

If the interest is compounded in another fashion we would adjust accordingly


3 . Return on investment is the total subtract the initial investment cost divided by the invesment cost

950 subtract 1000 is negative 50. Divide by 1000. Negative .05 or negative 5 percent . Assuming you are permitted to count the dividend as part of the investment .


1 and 2 i am unfamilar with the formula... for me to figure it out id need the interest .

thx this is what I got for 3 and 4. I sent 150 to you. lmk if you can figure out 1 and 2

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