1. Sharda bought a $1000 corporate bond this year at a discount for $975. The bond pays $80 of interest at the end of each of the next 5 years, at which time it will mature at its face value. If her required rate of return is 8.25%, what is the net present value of the investment?
a. $15.08
b. $13.93
c. -$12.80
d. -$35.23
2. Donovan bought a painting 5 years ago for $10,000. Two years ago, he spent $1500 to have it restored. This year, he sold it for $18,000. What is the internal rate of return on his investment?
a. 12.21%
b. 10.10%
c. 11.23%
d. 9.65%