JNU SSS 2011 Question 49: Time value of money and bond pricing
Consider the following :
Option I : You receive Rs 112 after one year.
Option II : You receive Rs 55 after nine months and Rs 56 after one year.
Given that the market rate of interest is 12% per annum, it follows that
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Answer and worked solution
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Time value of money and bond pricing has come up 20 times in 5 exams since 2010.
What this question tests
This question is on Present value, discounting and compounding, part of Time value of money and bond pricing in Macroeconomics.
Comparing money at different dates.
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