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1. Ellen now has $125. How much would she have after 8 years

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1. Ellen now has $125. How much would she have after 8 years if she leaves it invested at 8.5% with annual compounding? A) $205.83 B) $216.67 C) $228.07 D) $240.08 E) $252.08 2. Last year Rocco Corporation's sales were $225 million. If sales grow at 6% per year, how large (in millions) will they be 5 years later? A) $271.74 B) $286.05 C) $301.10 D) $316.16 E) $331.96 3. How much would $1, growing at 3.5% per year, be worth after 75 years? A) $12.54 B) $13.20 C) $13.86 D) $14.55 E) $15.28 4. Suppose a State of California bond will pay $1,000 eight years from now. If the going interest rate on these 8-year bonds is 5.5%, how much is the bond worth today? A) $651.60 B) $684.18 C) $718.39 D) $754.31 E) $792.02 5. Suppose the U.S. Treasury offers to sell you a bond for $747.25. No payments will be made until the bond matures 5 years from now, at which time it will be redeemed for $1,000. What interest rate would you earn if you bought this bond at the offer price? A) 4.37% B) 4.86% C) 5.40% D) 6.00% E) 6.60% 6. The Morrissey Company's bonds mature in 7 years, have a par value of $1,000, and make an annual coupon payment of $70. The market interest rate for the bonds is 8.5%. What is the bond's price? A) $923.22 B) $946.30 C) $969.96 D) $994.21 E) $1,019.06 7. Ezzell Enterprises’ noncallable bonds currently sell for $1,165. They have a 15-year maturity, an annual coupon of $95, and a par value of $1,000. What is their yield to maturity? A) 6.20% B) 6.53% C) 6.87% D) 7.24% E) 7.62% 8. Garvin Enterprises’ bonds currently sell for $1,150. They have a 6-year maturity, an annual coupon of $85, and a par value of $1,000. What is their current yield? A) 7.39% B) 7.76% C) 8.15% D) 8.56% E) 8.98%