+0  
 
0
193
1
avatar

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
 #1
avatar
0

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

26 Online Users

New Privacy Policy

We use cookies to personalise content and advertisements and to analyse access to our website. Furthermore, our partners for online advertising receive information about your use of our website.
For more information: our cookie policy and privacy policy.