finance

Project Description:

the 6 month,12 month,18 month,and 24 month interest rates are 3.00%, 3.50%, 4.00%, and 4.00% with semiannual compounding.

q1: what is the number of periods per year (m) with semiannual compounding?

q2: what are the equivalent 6 month,12 month,18 month,
24 month interest rates with continuous compounding?

q3: what is the forward rate for the six month
period beginning in 12 months (i.e., f1,1.5)? report the forward rate in both with continuous compounding and with semiannual compounding.

q4: what is the value of an fra, where you pay a fixed rate of 4.50% (with semiannual compounding) on a principal of $1 million for the six month period starting in 12 months?

note 1: please note that the interest rates given in
this task are with semiannual compounding.

note 2: all the rates in eq 4.5 are with continuous compounding. you should not use rm rates in
eq 4.5.
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Price Type: Negotiable

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