[sulin31]

For eg question say 12% redeemable bonds with 5 years remaining in the redemption at par value. The bonds are currently trading in the market at $100 ex-interest. The rate of corporation tax is 30%.

To get discount factor at the 5th year is 4.329,you will use the cumulative present value table.But at the 5th year,discount factor at 0.784,you use present value table.So would like to know in exam how do I know which table should I be using?

Since its 5 years,why I do not do it year by year calculation but do 1-5 year directly when I calculate discount factor?

Thanks.

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