The Time Value of Money in Finance
Free CFA Level I lesson in Quantitative Methods. 12 min read, ~1,729 words.
Bond PV = sum of discounted coupons + discounted face. Solving for the discount rate that matches price gives the implied yield (YTM). Coupon-yield link: a par bond has YTM = coupon, a discount bond YTM coupon, and a premium bond YTM < coupon. Zero-coupon yield: the single rate that...
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What this lesson covers
- Content
- Example 1
- Example 2
- Common Mistakes
- Check Your Understanding
- Exam Shortcuts
Learning objectives
- time value of money in finance
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