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How to find the Present Factor of a 3-year 1000CHF bond with a 12% annual interest rate ?

 

The answer should be 0,7050 

 

Thanks

Guest Apr 11, 2017
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By "Present Factor" do you mean "Present Value?" Also, if your answer is 705CHF, the interest rate of 12% is compounded semi-annually as follows:

 

PV =FV / [1 + R]^N

PV =1,000 / [1 + 0.12/2]^(3*2)

PV =1,000 / 1.06^6

PV =1,000 / 1.418519112256

PV =704.96

PV = ~705 Swiss Franks.

Guest Apr 11, 2017

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