Finding interest on bonds

Reference no: EM1334218

Assume all bonds are $1,000 par value. A person buys a 5 year, $1,000 certificate of deposit that carries a nominal rate of 9%, compounded semiannually. 6 months after this purchase, a 4 1/2-year CD at the same bank offers a 9.5% annual rate, also compounded semiannually. How much difference is there in total interest paid by the 2 competing investments?

Reference no: EM1334218

Questions Cloud

Prepare a training program for the employees : Career Development Plan Part II-Development of a Training and Mentoring Program - prepare a training program for the employees selected for your team.

Define beneficial for certain types of projects : There is a school of thought that argues that, far from being undesirable, some degree of scope creep may in fact be beneficial for certain kinds of projects e.g. it encourages stakeholder engagement, indicates responsiveness, and shows that objec..

Explain marketing - water proof cell phone analysis : Explain Marketing - Water Proof Cell Phone Analysis and Describe the attributes of water proof cell phones in detail

Show the importance of managers : Show the importance of managers/supervisors understanding the handbook, using it as a guideline, and the potential results that failure to understand it can have both within the company and outside in the community

Finding interest on bonds : Assume all bonds are $1,000 par value. A person buys a 5 year, $1,000 certificate of deposit which carries the nominal rate of 9%, compounded semiannually. How much difference is there in the total interest paid by the 2 competing investments?

Find speed of execution of application programs : As computer word size gets larger and larger, there is a law of diminishing returns; the speed of execution of application programs does not increase and may, in fact, decrease. define why this can occur.

Explain health care insurance toward your family : What is the importance to have health care insurance and What are the benefits of health care insurance toward your family?

Define three approaches to organizing programming teams : How does implementing a maintenance change differ from the new system development project.

Personal experience affect decision making style : What has been your personal experience with these various personalities, as you have found them displayed in managers, friends, and family? Have these differences affected you decision making style?

User Account

All Pages