Competitive positioning is often made at the __________________

A 15-year bond has an annual coupon rate of 8%.  The coupon rate will remain fixed until the bond matures.  The bond has a yield to maturity of 6%.  Which of the following statements is CORRECT?

A bond has a $1,000 par value, makes annual coupon payments of $100, has 5 years to maturity, cannot be called, and is not expected to default.  The bond should sell at a premium if current market rates are below 10% for the bond and at a discount if current market rates are greater than 10% for the bond.

Starting to invest earlier for retirement decreases the benefits of compound interest.

Rule 72 assumes an interest rate around 10.4% and says that money should double every 7 years.

Your bank account pays a 12% nominal rate of interest.  The interest is compounded monthly.  Which of the following statements is CORRECT?

A security is currently selling for $10,000 and promises to pay $1,500 annually for the next 10 years, and $1,000 annually in the 2 years thereafter with all payments occurring at the end of each year. If your required rate of return is 7%, should you buy this security?

You plan to retire in exactly 20 years. Your goal is to create a fund that will allow you to receive $25,000 at the end of each year for 30 years after you retire. (So you will receive your first payment in 21 years). You know that you will earn 10% (compounded annually) for the rest of your life. You want to make 20 end-of year deposits into your retirement account that will fund the 30-year stream of $25,000 annual annuity payments. How large do your annual deposits have to be?

Starting to invest later for retirement increases the benefits of compound interest.

What’s the present value of a perpetuity that pays $600 per year if the appropriate interest rate is 10%?