Question
A pays an expected cashflow of 10 at time 1, 3, 5, and 10. Then, A pays an expectedcashflow of 20 at time 11, 12,
A pays an expected cashflow of 10 at time 1, 3, 5, and 10. Then, A pays an expectedcashflow of 20 at time 11, 12, 13, 14,... (perpetuity). the rate is 11.4%
Compute the price of security A at time 10+ (PA,10+)
Remark: The notation t+ stands for time t right after cashflows have been paid.
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The Changing Geography Of Banking And Finance
Authors: Pietro Alessandrini ,Michele Fratianni ,Alberto Zazzaro
1st Edition
1441947205, 978-1441947208
