You have won a contest and will receive $2,500 a year in real terms for the next 3 years

You have won a contest and will receive $2,500 a year in real terms for the next 3 years. Each payment will be received at the end of the period with the first payment occurring one year from today. The relevant nominal discount rate is 6.3 percent and the inflation rate is 3.1 percent. What are your winnings worth today?    A.  $7,057 B.  $7,367 C.  $7,401 D.  $7,500 E.  $7,838

111.

You purchased an investment which will pay you $8,000, in real dollars, a year for the next three years. Each payment will be received at the end of the period with the first payment occurring one year from today. The nominal discount rate is 7.5 percent and the inflation rate is 2.9 percent. What is the present value of these payments?    A.  $21,720 B.  $22,004 C.  $22,511 D.  $23,406 E.  $23,529

112.

Sylvan Trees has a 7 percent coupon bond on the market with ten years left to maturity. The bond makes annual payments and currently sells for $842.10. What is the yield-to-maturity?    A.  8.50 percent B.  8.68 percent C.  8.92 percent D.  9.52 percent E.  9.68 percent   This cannot be solved directly, so it's easiest to just use the calculator method to get an answer. You can then use the calculator answer as the rate in the formula just to verify that your answer is correct.