1. Stan elects to receive his retirement benefit over 20 years at the rate of 2000 per month beginning one month from now. The monthly benefit increases by 5% each year. At a nominal interest rate of 6% convertible monthly, calculate the present value of the retirement benefit.
2. You just purchased a bond that matures in 12 years. The bond has a face value of $1,000 and has a 6% annual coupon. The bond has a current yield of 6.4%. What is the bond’s yield to maturity. (with equation method and financial calculator method)