An option will pay, at the end of one year,
30 if S(1) ≤ 50
20 if 50< S(1)≤60
0 if S(1) ≥0 "Did you mean Less than or equal to Zero?"

Hello Friend.

I would delete this comment as soon as possible. The testing window is still open and posting information concerning the exam you just took is in violation of the Societies...

patient they will soon release the exam for discussion.

Yes....Sorry but you just solved it in your answer.
Aha....

The call is at 5.30 meaning he doesnt get the most money when the Strike is at 0. He only receives $5.20 when He sells it.

His...

Just my thinking. I do not understand paying interest on capital profit yet I shall begin.

If he wants 6% per annum I take that he wants(1.06)^.5=1.029563
meaning 2.9563% per semiannual period...

The key thing to note is that at a Strike price of 0. You will activate your Put and sell for $5.30.
This means that at time of sell you will receive $5.30.
End of problem.

It is talking about...

This section must be all about Retrospect
Lets try by hand and then see how the finance calculator can help.

Hand
since principle paid in the last 12 payments is 2215.86 this must be the...

Try using a retrospective approach.

1st) We know that
PV=Loan=PMT[1-(1+i^(12)/12)^-60)/(i^(12)/12]
=PMT[(1-(1+0.12/12)^-60)/(0.12/12)]
=PMT[(1-1.01^-60)/.10]
=PMT*(44.955)
Thus...

Try 12/31/09-1/1/00 = 3652 days.
Divide 3652/360 =10.14years

take $200,000*(1-.0795)^10.14= $86,343.82

I came from a High school teaching math and graphic design background. 1 exam down and currently working for an insurance company in finance. 2nd exam February 16 next week. Welcome and good luck...

I am using an Actex exam from 2008 a coworker gave me.
I am sitting for my exam Feb 16th. How did it go for you?

[QUOTE=Tooshu;73237]Re(Hello Miss F. I am new to this forum but I believe the answer to be
PV = $49.06)

We can look at the series of payments as 2 year annuities.(A,n=2,i=7)
They begin in 5...

While I like the level of thought that went into this question I do believe there to be one small flaw. Mortgage loans are typically financed using a nominal interest rate convertible monthly. Your...

Try using 10%-3%=7% as the new interest rate.
Then maybe an annuity due for ten years with level 1000 payments growing at 7%interes and then run that through the next 18 years with o$payments at a...

Thanks Good luck to you as well.

Hmmm.. This is true. I just recently joined and confess that I am nervous about my upcoming FM exam on February 16th. I just wanted to try to understand the and attempt the problems that people were...

I)
Try chunking into 2 year level annuity immediates discounted to the PV
Thus
PV= 5000(A,n=2,i=5.5)+v^2*6000(A,n=2,i=5.5)+...v^16*13000(A,n=2,i=5.5)+v^18*14000(A,n=2,i=5.5)...

"The coupon payable semi-annually is 400"
This is where the 400 payment comes from.
you are correct the periods are 2*20.

(Leo will make an initial deposit of $1000 at time 0, followed by 5 annual deposits of $200 at times 1,2,3,4,5. He will receive payments from the account at time 7,8,9, starting $1500 and decreasing...

please post the entire problem

Re(Hello Miss F. I am new to this forum but I believe the answer to be
PV = $49.06)

We can look at the series of payments as 2 year annuities.(A,n=2,i=7)
They begin in 5 years and then 1$, then...

Re(Using an annual effective interest rate of 7%, calculate the present value of a perpetuity on
which payments are 1 at the end of the 5th and 6th years, 2 at the end of the 7th and 8th years, 3 at...