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Answer to Question #54420 in Microeconomics for Natalie
Question #54420
The six month and one-year rates are 3% and 4% per annum with semi-annual compounding. Is 3.90% or 3.95% or 3.99% closest to the one-year par yield expressed with semi-annual compounding?
Expert's answer
If the six month and one-year rates are 3% and 4% per annum with semi-annual compounding, then 3.99% is closest to the one-year par yield expressed with semi-annual compounding.
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