U. S. Treasury bond

Project description
€¢Chapter 7: P4

Problem 4-Assume personal income was $ 28 million last year. Personal outlays were $ 20 million and personal current taxes were $ 5 million. a. What was the amount of

disposable personal income last year? b. What was the amount of personal saving last year? c. Calculate personal saving as a percentage of disposable personal income.

€¢Chapter 8: P4
A thirty- year U. S. Treasury bond has a 4.0 percent interest rate. In contrast, a ten- year Treasury bond has an interest rate of 3.7 percent. If inflation is

expected to average 1.5 percentage points over both the next ten years and thirty years, determine the maturity risk premium for the thirty- year bond over the ten-

year bond.

€¢Chapter 9: P6
Determine the present values if $ 5,000 is received in the future ( i. e., at the end of each indicated time period) in each of the follow-ing situations: a. 5 percent

for ten years b. 7 percent for seven years c. 9 percent for four years