Question: I'm buying a bond that will pay me $1,000/year for 5 years starting 1 year from now. I want to make 12%/year on the investment, what should I pay for this today? I got$3,604.77 by using the FV Annuity formula I have in my book. Is this correct?

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I think this question is really an good example of what this forum is not about. I would vote to close this question, does this makes sense to other people than me ? –  TheBridge Feb 9 '11 at 21:09
@TheBridge: I've been debating the same thing. It's on-topic but uninteresting and a lot like a homework question. –  Joshua Ulrich Feb 9 '11 at 21:17
IMO on-topic = valid question. Uninteresting is subjective = don't answer it, but allow the opportunity for others. Perhaps we need to add a homework tag? –  Greg Feb 9 '11 at 21:59
@Joshua I had thought this was a CFA question. And I agree that it's officially on-topic, but it's like asking how variables work on Stack Overflow. –  chrisaycock Feb 9 '11 at 22:00
@Greg SO is trying to get rid of meta tags like "homework", etc. Though that hasn't stopped eager editors from retagging existing questions... –  chrisaycock Feb 9 '11 at 22:01
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closed as too localized by olaker♦Mar 12 '11 at 15:35

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