#20
In this problem, despite payments being made at mid-year the durations in the sample answer are 1, 2 and 3. Yet, for 2015.Fall #19 a similar comment is made of payments being made mid-year and the durations are 0.5, 1.5 and 2.5, which is what I thought would be correct for 2017 also. Is this just an error in the sample answer for 2017?
Comments
I now see the duration in 2017 is for how long capital is held not when loss payments are made. Thank you, anyways.
That's correct. Good luck.