Question
Considering the formulae below, what are the most important variables in driving the computed fair interest rate. Justify your answer. D = Xe^-rt - [Xe^-rt
Considering the formulae below, what are the most important variables in driving the computed fair interest rate. Justify your answer.
D = Xe^-rt - [Xe^-rt * N(-d2) - Ae^t * N (-d 1 )]
d 1 = [ ( ln A/X ) + ( r - + /2 )t ] / (t)
d 2 = d 1 - t
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Entrepreneurial Finance
Authors: J . chris leach, Ronald w. melicher
4th edition
538478152, 978-0538478151
