Question
The price of a perpetuity-immediate with annual level payments of $100 is calculated at an annual effective interest rate of 4%. Estimate the new price
The price of a perpetuity-immediate with annual level payments of $100 is calculated at an annual effective interest rate of 4%. Estimate the new price of this perpetuity if the interest rate increases to 4.2% using the first-order modified approximation. Possible Answers A 2375 B 2500 C 2625 D 2675 E 2700.
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The Yield Curve And Financial Risk Premia Implications For Monetary Policy
Authors: Felix Geiger
1st Edition
3642215742, 3642215750, 9783642215742, 9783642215759
