The accumulation function for fund X is given by: ax(t) = 1 + 0.5t. The accumulation function for fund Yis given by: ay(t) = 1 + 0.5t². At time T, the force of interest is the same for the two funds. Find T. (a) 0.11 (b) 0.45 (c) 0.59 (d) 0.90 (e) 1.16

PV = Cash Flow/Interest Rate is the present value shortcut formula for which of the following: * A perpetuity A single cash flow in the future A growing perpetuity An annuity

Find the internal rate of return (IRR) for the following cash flows. Enter your answer as a percent and include at least two decimal points, e.g., 8.35 for 8.35 %, not 0.08. Year Cash Flow 0 750 1 200 2 375 3 250 4 100 5 75

Consider two assets with the following cash flow streams:   Asset A generates $4 at t=1, $3 at t=2, and $10 at t=3. Asset B generates $2 at t=1, $X at t=2, and $10 at t=3.   Suppose X=6 and the interest rate r is constant.   For r=0.1, calculate the present value of the two assets. Determine the set of all interest rates {r} such that asset A is more valuable than asset Draw the present value of the assets as a function of the interest rate. Suppose r=0.2. Find the value X such that the present value of asset B is 12. Suppose the (one-period) interest rates are variable and given as follows: r01=0.1,r12=0.2, r23=0.3. Calculate the yield to maturity of asset A. (You can use Excel or ascientific calculator to find the solution numerically.)