利用者‐会話:Stingfeng
表示
Interest Rate
Types of Rates
1.Treasury Rates 2.LIBOR 3.Repo Rates
Measuring Interest Rates
Suppose that the interest rate is 10% Compounding frequency Value of $100 at end of year($) Annually(m=1) $100*(1+10%)=$110 Semiannually(m=2) ($100+$100*10%/2)+($100+$100*10%/2)*10%/2=$110*(1+5%)*(1+5%)=$110.25 Quarterly(m=4) $100*(1+2.5%)*(1+2.5%)*(1+2.5%)*(1+2.5%)=$110.35 Monthly(m=12) 110.47 Weekly(m=52) 110.51 Daily(m=365) 110.52
Suppose that an amount A is invested for n years at an interest rate of R per annum.If the rate is compounded mtimes
per annum,the termianl value of the investment is