1. You have the chance to buy a promissory note in which you will receive 36 monthly payments of $750 (starting a month from now), followed by 12 monthly payments of $850. What is your yield if you buy the note for $35,000?
a. 2.95% compounded monthly
b. 3.15% compounded monthly
c. 4.66% compounded monthly
d. 0.13% compounded monthly
2. Assume the average market return over the next 50 years is expected to be 7.7%. If an investor contributes $19 thousand into an investment account today, pays 2% of assets under management for various fund and advisor fees, and waits for 50 years, what percentage of his final wealth has he sacrificed in fees?
Enter answer in percents.