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Hi, In 502.2 , the last line of the question (which is also in the study notes) states "If the investor does not roll, the net proceeds are the coupon plus principal paydown: $10,000,000.00 × (6.0%/12 + 2.0%) or $250,000.00". I have a very rudimentary doubt that if the investor does not roll...

Thank you for the detailed explanation. :)

Hi, Can some one please explain the solution to P1.T4.313.3 http://forum.bionicturtle.com/threads/p1-t4-313-forwardand-par-rates.6892/ 313.3. We are given the 1.5 year discount function (i.e., set of discount factors) below. Also, below is the mathematical definition of the semi-annual par...

Hi, The extract of the answer 505.2 is pasted here: Therefore, the current value equals $101.160*(1+0.250 /2)^-(0.25*2) = $100.97089. $101.160*(1+0.250 % /2)^-(0.25*2) = $100.9708.... I believe the % sign is missing in the original answer after 0.25

Sorry got it !!!

Hi , with reference to 405.1, can anybody please let me know how 1.28 was arrived in the solution ?