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Sir I made a mistake a in duration calculation in cashflow I only take intertest amount and not equal installment amount but my approach was right so can i get some marks or not?
If your approach was correct, then you will not lose many marks (each bit of workings is marked separately and there are more marks for the approach than for the actual figures)
So don’t worry too much 🙂
Dear John,
Was the correct approach Maculay duration?? I haven’t come across anything called modified duration in the text or in OT study materials. I approached it with Maculay and missed the point as little with only interest payments for four years equally and the principal at the end of fourth year and also explained in my opinion fairly reasonably about the result. I got about 3.88 years for the full repayment. Do you think I will gain some marks??
Thanks
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