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Spot yield

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Spot yield

  • This topic has 1 reply, 2 voices, and was last updated 7 years ago by AvatarJohn Moffat.
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  • June 1, 2018 at 12:18 pm #455263
    Avataradurich
    Member
    • Topics: 127
    • Replies: 120
    • ☆☆☆

    When calculating spot yield

    For example three years there is redemption plus interest

    105 (1+r)^-3. 88.65

    The answer is 5.8%

    When I do it on calculator I can’t solve this equation for r .

    Would you please rearrange this ..in a way I get r = 5.8 %

    Thank u

    June 1, 2018 at 5:32 pm #455309
    AvatarJohn Moffat
    Keymaster
    • Topics: 57
    • Replies: 54839
    • ☆☆☆☆☆

    (1+r)^-3 is another way of writing 1/((1+r)^3)

    Now you should be able to get the answer 🙂

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