Sharon smith will receive 1 million in 50 years the

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1.The following are the expected 1 year T-bill rates for the next 4 years: 3%, 4%, 5%, and 6%. What would you expect the rate for 3 year securities would be?

 

A. 4%

B. 4.5%

C. 6%

D. 3.75%

2.If average daily remittances are $6 million, and "extended disbursement float" adds 2 days to the disbursement schedule, how much should the firm be willing to pay for a cash management system if the firm earns 7% on excess funds.

A. $500,000

B. $1,500,000

C. $0

D. $840,000

3.A 15-year zero-coupon bond was issued with a $1000 par value to yield 8%. What is the approximate market value of the bond?

A. $597

B. $315

C. $27

D. $482

4.Sharon Smith will receive $1 million in 50 years. The discount rate is 14%. As an alternative, she can receive $1,000 today. Which should she choose?

A. the $1 million dollars in 50 years.

B. $2,000 today.

C. $1,00

D. need more information.

Reference no: EM13620972

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