0 Debansu GuptaAdvanced Asked: July 4, 20222022-07-04T21:48:57+05:30 2022-07-04T21:48:57+05:30In: Fixed Income (CFA L1) Fixed income 0 Q31 Share Sorry, you do not have permission to answer to this question. 3 Answers Oldest Eshaan Sachdev The Official Nerd 2022-07-04T22:03:40+05:30Added an answer on July 4, 2022 at 10:03 pm PV=-97 1+0.8/2=0.9=PMT 100 FV CPT I/Y=1.68*2 =3.36 DISCOUNT MARGIN=3.36-LIBOR=3.36-1=2.36% Gaurav Awasthi Advanced 2022-07-16T21:14:51+05:30Replied to answer on July 16, 2022 at 9:14 pm In question, LIBOR is 80 bps so while solving why you subtract 1 Eshaan Sachdev The Official Nerd 2022-07-16T23:59:18+05:30Replied to answer on July 16, 2022 at 11:59 pm LIBOR is the MRR i.e 1%, LIBOR is a type of Market Reference Rate (MRR). other examples include EURIBOR etc etc
PV=-97
1+0.8/2=0.9=PMT
100 FV
CPT I/Y=1.68*2 =3.36
DISCOUNT MARGIN=3.36-LIBOR=3.36-1=2.36%
In question, LIBOR is 80 bps
so while solving why you subtract 1
LIBOR is the MRR i.e 1%,
LIBOR is a type of Market Reference Rate (MRR).
other examples include EURIBOR etc etc