Question
A company has agreed that it will receive 3% on $50 million for 3 months starting in 2 years. Suppose rate proves to be 3.5%
A company has agreed that it will receive 3% on $50 million for 3 months starting in 2 years. Suppose rate proves to be 3.5% (with quarterly compounding.
(1) Calculate the payoff at the 2.25 year point. Answer: $62,500
(2) Calculate the equivalent payoff at the 2-year point. Answer: -$61,957.87
Answers are included, I just have no idea how the teacher got them.
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Focus On Personal Finance
Authors: Jack Kapoor, Les Dlabay, Robert Hughes, Melissa Hart
6th Edition
125991965X, 978-1259919657
