Question
We consider following yield curve: Maturity 1 2 3 4 5 ... 10 ... 50 Yields (%) 12 11,5 11 10,5 10 ... 9,5 ...
We consider following yield curve:
| Maturity | 1 | 2 | 3 | 4 | 5 | ... | 10 | ... | 50 |
| Yields (%) | 12 | 11,5 | 11 | 10,5 | 10 | ... | 9,5 | ... | 9 |
We are planning to participate in investments which will be in 3 years from now. This investment will bring you every year 1 mil. USD over 47 years. What is the maximum price will be willing to accept?
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Step: 1
Interest rate of the proposed investment in three years is the sp...
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Engineering Economy
Authors: Leland T. Blank, Anthony Tarquin
8th edition
73523439, 73523437, 978-0073523439
