Question
The rate applicable to an investment lasting for n years
when all the returns are realized at the end is called:Solution
The rate applicable to an investment for n years when all the returns are earned at the end of the maturity period is called zero rate or forward rate. Forward rates are the rates applicable to future time periods implied by today’s zero rates.
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Which among the following can result into the difference in the cash and the pass book balance:
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The bailment of goods as security for payment of debt or performance of a promise is called:
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