if the yield curve given is semi annual compounding and the 2 years rate is 0.6%, what is the present value of 1 dollar which is received at time 2 (2 years times)?
thanks
if the yield curve given is semi annual compounding and the 2 years rate is 0.6%, what is the present value of 1 dollar which is received at time 2 (2 years times)?
thanks
1 / (1+ 0.006/2) ^ (2*2) = 1 / (1.003 ^4) = 0.988089
Alternatively:
N=4; I/Y = .3; PMT = 0; FV = 1; PV -> CPT
PV = -.988089