Year Promisedcash flows Expectedcash flows 1 6 5 2 6 5 3 6 5 4 6 5 5 6 5 6 6 5 7 6 5 8 6 5 9 6 5 10 106 95 What is the present value today of promised cash flows at 6%? If the price...

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Finance

Year

Promisedcash flows

Expectedcash flows

1

6

5

2

6

5

3

6

5

4

6

5

5

6

5

6

6

5

7

6

5

8

6

5

9

6

5

10

106

95

  1. What is the present value today of promisedcash flows at 6%?
  2. If the price of the bond is 80, what is the yield to maturityof the bond using the promised cash flows?

  1. What is the present value today of theexpected cash flows at 6%?

  1. What would the IRR be if the bond were purchased at 80 and theholder received the expected cash flows?

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