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Problem 4 : Perfect Substitutes You receive a cash flow of 5 0 , 0 0 0 $ and you decide to deposit it for
Problem : Perfect Substitutes
You receive a cash flow of $ and you decide to deposit it for a year in a saving account offering
an annual interest rate of with monthly compounding. The teller asks you if you would consider
a different account with annual compounding.
For which interest rate would you be indifferent to switch to annual compounding?
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Lords Of Finance The Bankers Who Broke The World
Authors: Liaquat Ahamed
1st Edition
0143116800, 978-0143116806
