

FlashChat  Actuarial Discussion  Preliminary Exams  CAS/SOA Exams  Cyberchat  Around the World  Suggestions 
DW Simpson International Actuarial Jobs 
Financial Mathematics Old FM Forum 

Thread Tools  Search this Thread  Display Modes 
#42




a question on the Practice exam 5 #21 (December 2005 edition)
This is a premium bond because the coupon rate is 4%, which is greater than i, where the interest i=3.5%. Since it's a premium bond, we want the redemption date to be the earliest possible date, right? I don't understand why the answer isn't 111.25 (t=10)? Thank you!

#44




Premium bond?
Quote:
Does my answer make sense? Yours, Krzys' 
#45




Quote:
I didn't understand this explanation in the solution, but I got it now. I like this problem. Thanks, Krzys'. if price=111.25, c=100, Fr=4, n=20, then, i=3.22% < 3.5%. if price=107.11, c=100, Fr=4, n=15, then, i=3.38% > 3.5%. 
#47




Quote:

#48




Optionfree bond
Quote:
Yours, Krzys' 
#49




Sugarfree, optionfee, etc.
Quote:
Yours, Krzys' Ostaszewski 
Thread Tools  Search this Thread 
Display Modes  

