Question
The Present Value of the liability payments=123.5902709. The Discounted Mean Term of the liability payments=28.3984545 An asset pays nominal amounts M and N after 10
The Present Value of the liability payments=123.5902709.
The Discounted Mean Term of the liability payments=28.3984545
An asset pays nominal amounts M and N after 10 and 20 years respectively. What are the values of M and N such that the asset and liability payments have the same present values and discounted mean terms at an effective rate of interest of 5%p.a? What is a drawback with the matching strategy outlined?
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Forensic And Investigative Accounting
Authors: D. Larry Crumbley, Lester E. Heitger, Stevenson Smith
5th Edition
0808026879, 9780808026877
