Q#1: How to compute PV of face value $10,000 when the discount rate is 3% and...

 

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Q#1: How to compute PV of face value $10,000 when the discount rate is 3% and the maturity is 10 periods of 6 months (5 years)? Interest = face value ($10,000) * coupon rate (2.5%) = $250 1/1/Y1 6/30/Y1 12/31/Y1 SLIDE #6 0.03 6/30/Y3 12/31/Y3 6/30/Y2 12/31/Y2 6/30/Y4 12/31/Y4 6/30/Y5 12/31/Y5 $243 $250 $236 $250 $229 $250 $222 $250 $216 $250 $209 $250 $203 $250 $197 $250 $192 $250 $186 $250 Q#1: How to compute PV of face value $10,000 when the discount rate is 3% and the maturity is 10 periods of 6 months (5 years)? Interest = face value ($10,000) * coupon rate (2.5%) = $250 1/1/Y1 6/30/Y1 12/31/Y1 SLIDE #6 0.03 6/30/Y3 12/31/Y3 6/30/Y2 12/31/Y2 6/30/Y4 12/31/Y4 6/30/Y5 12/31/Y5 $243 $250 $236 $250 $229 $250 $222 $250 $216 $250 $209 $250 $203 $250 $197 $250 $192 $250 $186 $250

Answer rating: 100% (QA)

To compute the present value PV of a face value of 10000 when the discount rate is 3 and the maturit... View the full answer