Homework Assignment – Week 2

Rate y in (15b) can be interpreted in two ways. First, it is the single rate that discounts the promised payments (,, etc.) to a total market value equal to the price of the bond, V. Rate y is a complex weighted-average of all of the in (15a). Each of the discounted amounts in (15b) will generally not equal its counterpart in (15a). ................
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