Used Credit Line $ 1,000

Required Minimum
2%
balance

Credit card IR 30.00% Customer may think tha

Monthly IR 2.500% Customer will end up ow

Month Interest Month

Starting Balance Minimum Ending Strate
from now Balance for the Owed Payment Balance from now
Month
1 $ 1,000 $ 20.00 $ 980.00 1 $1,040.00
2 $ 980.00 $ 24.50 $ 1,004.50 $ 20.09 $ 984.41 2 $1,030.00
3 $ 984.41 $ 24.61 $ 1,009.02 $ 20.18 $ 988.84 3 $1,020.00
4 $ 988.84 $ 24.72 $ 1,013.56 $ 20.27 $ 993.29 4 $1,010.00

Ending Balance
5 $ 993.29 $ 24.83 $ 1,018.12 $ 20.36 $ 997.76 5

$984.40
$1,000.00

$980.00
6 $ 997.76 $ 24.94 $ 1,022.70 $ 20.45 $ 1,002.25 6
$990.00
7 $1,002.25 $ 25.06 $ 1,027.31 $ 20.55 $ 1,006.76 7
8 $1,006.76 $ 25.17 $ 1,031.93 $ 20.64 $ 1,011.29 8 $980.00
9 $1,011.29 $ 25.28 $ 1,036.57 $ 20.73 $ 1,015.84 9 $970.00
10 $1,015.84 $ 25.40 $ 1,041.24 $ 20.82 $ 1,020.41 10 $960.00
11 $1,020.41 $ 25.51 $ 1,045.92 $ 20.92 $ 1,025.00 11 $950.00
12 $1,025.00 $ 25.63 $ 1,050.63 $ 21.01 $ 1,029.62 12 1 2
Customer may think that they had paid $ 246.03

Customer will end up owing more at the end of the month

Ending Strategy of paying the minimum

Balance

$1,029.52
$1,024.92
$1,020.34
$1,040.00
$ 980.00

$1,015.77
$1,011.23
$ 984.40
$1,030.00 $1,006.71
$1,002.21

$ 988.82
$1,020.00
$997.73

$ 993.27
$993.27

$1,010.00
Ending Balance

$988.82

$ 997.73
$984.40

$1,000.00
$980.00

###
$990.00
###
$980.00
###
###
$970.00
###
$960.00
###
$950.00
### 1 2 3 4 5 6 7 8 9 10 11 12

Month
 -41,033,062.65 ₫
1,863,751,456.03 ₫
1,904,784,518.68 ₫
Mortgage 2,000,000,000 ₫
APR 1%
Maturity 60
Frequency of payments Annually
Periodic rate 1%

Số kì trả nợ Dư nợ đầu kì Số tiền trả góp Lãi đã trả trong kì

1 2,000,000,000 ₫ 44,488,895.37 ₫ 20,000,000 ₫

2 1,975,511,104.63 ₫ 44,488,895.37 ₫ 19,755,111.05 ₫
3 1,950,777,320.31 ₫ 44,488,895.37 ₫ 19,507,773.20 ₫
4 1,925,796,198.14 ₫ 44,488,895.37 ₫ 19,257,961.98 ₫
5 1,900,565,264.75 ₫ 44,488,895.37 ₫ 19,005,652.65 ₫
6 1,875,082,022.03 ₫ 44,488,895.37 ₫ 18,750,820.22 ₫
7 1,849,343,946.88 ₫ 44,488,895.37 ₫ 18,493,439.47 ₫
8 1,823,348,490.98 ₫ 44,488,895.37 ₫ 18,233,484.91 ₫
9 1,797,093,080.52 ₫ 44,488,895.37 ₫ 17,970,930.81 ₫
10 1,770,575,115.95 ₫ 44,488,895.37 ₫ 17,705,751.16 ₫
11 1,743,791,971.74 ₫ 44,488,895.37 ₫ 17,437,919.72 ₫
12 1,716,740,996.09 ₫ 44,488,895.37 ₫ 17,167,409.96 ₫
13 1,689,419,510.68 ₫ 44,488,895.37 ₫ 16,894,195.11 ₫
14 1,661,824,810.42 ₫ 44,488,895.37 ₫ 16,618,248.10 ₫
15 1,633,954,163.15 ₫ 44,488,895.37 ₫ 16,339,541.63 ₫
16 1,605,804,809.42 ₫ 44,488,895.37 ₫ 16,058,048.09 ₫
17 1,577,373,962.14 ₫ 44,488,895.37 ₫ 15,773,739.62 ₫
18 1,548,658,806.39 ₫ 44,488,895.37 ₫ 15,486,588.06 ₫
19 1,519,656,499.09 ₫ 44,488,895.37 ₫ 15,196,564.99 ₫
20 1,490,364,168.71 ₫ 44,488,895.37 ₫ 14,903,641.69 ₫
21 1,460,778,915.02 ₫ 44,488,895.37 ₫ 14,607,789.15 ₫
22 1,430,897,808.80 ₫ 44,488,895.37 ₫ 14,308,978.09 ₫
23 1,400,717,891.52 ₫ 44,488,895.37 ₫ 14,007,178.92 ₫
24 1,370,236,175.07 ₫ 44,488,895.37 ₫ 13,702,361.75 ₫
25 1,339,449,641.45 ₫ 44,488,895.37 ₫ 13,394,496.41 ₫
26 1,308,355,242.49 ₫ 44,488,895.37 ₫ 13,083,552.42 ₫
27 1,276,949,899.55 ₫ 44,488,895.37 ₫ 12,769,499.00 ₫
28 1,245,230,503.17 ₫ 44,488,895.37 ₫ 12,452,305.03 ₫
29 1,213,193,912.84 ₫ 44,488,895.37 ₫ 12,131,939.13 ₫
30 1,180,836,956.60 ₫ 44,488,895.37 ₫ 11,808,369.57 ₫
31 1,148,156,430.79 ₫ 44,488,895.37 ₫ 11,481,564.31 ₫
32 1,115,149,099.73 ₫ 44,488,895.37 ₫ 11,151,491.00 ₫
33 1,081,811,695.36 ₫ 44,488,895.37 ₫ 10,818,116.95 ₫
34 1,048,140,916.94 ₫ 44,488,895.37 ₫ 10,481,409.17 ₫
35 1,014,133,430.74 ₫ 44,488,895.37 ₫ 10,141,334.31 ₫
36 979,785,869.68 ₫ 44,488,895.37 ₫ 9,797,858.70 ₫
37 945,094,833.00 ₫ 44,488,895.37 ₫ 9,450,948.33 ₫
38 910,056,885.97 ₫ 44,488,895.37 ₫ 9,100,568.86 ₫
39 874,668,559.45 ₫ 44,488,895.37 ₫ 8,746,685.59 ₫
40 838,926,349.68 ₫ 44,488,895.37 ₫ 8,389,263.50 ₫
41 802,826,717.81 ₫ 44,488,895.37 ₫ 8,028,267.18 ₫
42 766,366,089.61 ₫ 44,488,895.37 ₫ 7,663,660.90 ₫
43 729,540,855.14 ₫ 44,488,895.37 ₫ 7,295,408.55 ₫
44 692,347,368.32 ₫ 44,488,895.37 ₫ 6,923,473.68 ₫
45 654,781,946.64 ₫ 44,488,895.37 ₫ 6,547,819.47 ₫
46 616,840,870.73 ₫ 44,488,895.37 ₫ 6,168,408.71 ₫
47 578,520,384.07 ₫ 44,488,895.37 ₫ 5,785,203.84 ₫
48 539,816,692.54 ₫ 44,488,895.37 ₫ 5,398,166.93 ₫
49 500,725,964.10 ₫ 44,488,895.37 ₫ 5,007,259.64 ₫
50 461,244,328.37 ₫ 44,488,895.37 ₫ 4,612,443.28 ₫
51 421,367,876.28 ₫ 44,488,895.37 ₫ 4,213,678.76 ₫
52 381,092,659.67 ₫ 44,488,895.37 ₫ 3,810,926.60 ₫
53 340,414,690.90 ₫ 44,488,895.37 ₫ 3,404,146.91 ₫
54 299,329,942.44 ₫ 44,488,895.37 ₫ 2,993,299.42 ₫
55 257,834,346.50 ₫ 44,488,895.37 ₫ 2,578,343.46 ₫
56 215,923,794.59 ₫ 44,488,895.37 ₫ 2,159,237.95 ₫
57 173,594,137.17 ₫ 44,488,895.37 ₫ 1,735,941.37 ₫
58 130,841,183.17 ₫ 44,488,895.37 ₫ 1,308,411.83 ₫
59 87,660,699.63 ₫ 44,488,895.37 ₫ 876,607.00 ₫
60 44,048,411.26 ₫ 44,488,895.37 ₫ 440,484.11 ₫
 years

2,500,000,000.00 ₫

1,909,094,811.30 ₫
Gốc đã trả trong Month
Dự nợ còn lại
kì from now Remaining Principal

Principal Balance Remaining

24,488,895.37 ₫ 1,975,511,104.63 ₫ 1 1,956,295,582.35 ₫
2,000,000,000.00 ₫
24,733,784.32 ₫ 1,950,777,320.31 ₫ 2 1,909,094,811.30 ₫
24,981,122.17 ₫ 1,925,796,198.14 ₫ 3 1,858,117,978.55 ₫
25,230,933.39 ₫ 1,900,565,264.75 ₫ 4 1,803,062,999.19 ₫
25,483,242.72 ₫ 1,875,082,022.03 ₫ 5 1,743,603,621.48 ₫
25,738,075.15 ₫ 1,849,343,946.88 ₫ 6 1,679,387,493.55 ₫
1,500,000,000.00 ₫
25,995,455.90 ₫ 1,823,348,490.98 ₫ 7 1,610,034,075.39 ₫
26,255,410.46 ₫ 1,797,093,080.52 ₫ 8 1,535,132,383.77 ₫
26,517,964.56 ₫ 1,770,575,115.95 ₫ 9 1,454,238,556.83 ₫
26,783,144.21 ₫ 1,743,791,971.74 ₫ 10 1,366,873,223.73 ₫
27,050,975.65 ₫ 1,716,740,996.09 ₫ 11 1,272,518,663.98
1,000,000,000.00 ₫₫
27,321,485.41 ₫ 1,689,419,510.68 ₫ 1,733,908,406.05 ₫ 12 1,170,615,739.46 ₫
27,594,700.26 ₫ 1,661,824,810.42 ₫ 13 1,060,560,580.97 ₫
27,870,647.27 ₫ 1,633,954,163.15 ₫ 14 941,701,009.80 ₫
28,149,353.74 ₫ 1,605,804,809.42 ₫ 15 813,332,672.93 ₫
28,430,847.28 ₫ 1,577,373,962.14 ₫ 16 674,694,869.12
500,000,000.00 ₫ ₫
28,715,155.75 ₫ 1,548,658,806.39 ₫ 17 524,966,041.01 ₫
29,002,307.31 ₫ 1,519,656,499.09 ₫ 18 363,258,906.64 ₫
29,292,330.38 ₫ 1,490,364,168.71 ₫ 19 188,615,201.52 ₫
29,585,253.68 ₫ 1,460,778,915.02 ₫ 1,504,602,282.47 ₫ 20 0.00 ₫
29,881,106.22 ₫ 1,430,897,808.80 ₫ 0.00 ₫
2
30,179,917.28 ₫ 1,400,717,891.52 ₫
30,481,716.45 ₫ 1,370,236,175.07 ₫
30,786,533.62 ₫ 1,339,449,641.45 ₫
31,094,398.96 ₫ 1,308,355,242.49 ₫
31,405,342.94 ₫ 1,276,949,899.55 ₫ -500,000,000.00 ₫

31,719,396.37 ₫ 1,245,230,503.17 ₫
32,036,590.34 ₫ 1,213,193,912.84 ₫
32,356,956.24 ₫ 1,180,836,956.60 ₫
32,680,525.80 ₫ 1,148,156,430.79 ₫ 1,192,645,326.16 ₫
33,007,331.06 ₫ 1,115,149,099.73 ₫
33,337,404.37 ₫ 1,081,811,695.36 ₫
33,670,778.42 ₫ 1,048,140,916.94 ₫
34,007,486.20 ₫ 1,014,133,430.74 ₫
34,347,561.06 ₫ 979,785,869.68 ₫
34,691,036.67 ₫ 945,094,833.00 ₫
35,037,947.04 ₫ 910,056,885.97 ₫
35,388,326.51 ₫ 874,668,559.45 ₫
35,742,209.78 ₫ 838,926,349.68 ₫
36,099,631.87 ₫ 802,826,717.81 ₫
36,460,628.19 ₫ 766,366,089.61 ₫
36,825,234.47 ₫ 729,540,855.14 ₫
37,193,486.82 ₫ 692,347,368.32 ₫
37,565,421.69 ₫ 654,781,946.64 ₫
37,941,075.90 ₫ 616,840,870.73 ₫
38,320,486.66 ₫ 578,520,384.07 ₫
38,703,691.53 ₫ 539,816,692.54 ₫
39,090,728.44 ₫ 500,725,964.10 ₫
39,481,635.73 ₫ 461,244,328.37 ₫
39,876,452.09 ₫ 421,367,876.28 ₫
40,275,216.61 ₫ 381,092,659.67 ₫
40,677,968.77 ₫ 340,414,690.90 ₫
41,084,748.46 ₫ 299,329,942.44 ₫
41,495,595.95 ₫ 257,834,346.50 ₫
41,910,551.90 ₫ 215,923,794.59 ₫
42,329,657.42 ₫ 173,594,137.17 ₫
42,752,954.00 ₫ 130,841,183.17 ₫
43,180,483.54 ₫ 87,660,699.63 ₫
43,612,288.37 ₫ 44,048,411.26 ₫
44,048,411.26 ₫ 0.00 ₫
 0.00 ₫

00,000.00 ₫
00,000.00 ₫
00,000.00 ₫
00,000.00 ₫
00,000.00 ₫
00,000.00 ₫

ng Principal

2
1,909,094,811.30 ₫

3
1,858,117,978.55 ₫

4
1,803,062,999.19 ₫

5
1,743,603,621.48 ₫

6
1,679,387,493.55 ₫

7
1,610,034,075.39 ₫

8
1,535,132,383.77 ₫

9
1,454,238,556.83 ₫

Months
10
1,366,873,223.73 ₫

Remaining Principal
11
1,272,518,663.98 ₫
12

1,170,615,739.46 ₫
Loan Amortization of a 2 billions VND for 20 payments and an APR
al
11
1,272,518,663.98 ₫

12
1,170,615,739.46 ₫

13
1,060,560,580.97 ₫
ments and an APR of 8%

14
941,701,009.80 ₫

15
813,332,672.93 ₫

16
674,694,869.12 ₫

17
524,966,041.01 ₫

18
363,258,906.64 ₫

19
188,615,201.52 ₫

20
0.00 ₫
Interest Only Loan Schedule
Loan amount 3,000,000,000 ₫
Interest rate 15%
Maturity 5 years
Annual Interest
Payment 450,000,000 ₫

Principal paid at the

end of 5th year 3,000,000,000 ₫

Deposits After 4 years

After 3 years
Monthly deposit ? After 2 years
Interest rate 11.0% After 1 years
Monthly IR 0.009166666667 Total loans
EAR 0.115718836195 Monthly deposit

PV of 1st Interest
Payment
PV of 2nd Interest
Payment
PV of 3rd Interest
Payment
PV of 4th Interest
Payment
PV of last Interest
and Principal
0.00 Payment
PV of the total
paymen
 FV
697,319,121.51 ₫
624,995,383.14 ₫
560,172,834.65 ₫
502,073,476.29 ₫
5,834,560,815.58 ₫
73,374,015.55 ₫

PV
403,327,420.32 ₫

361,495,573.29 ₫

324,002,393.40 ₫

290,397,887.79 ₫

1,995,470,305.02 ₫

3,374,693,579.80 ₫
73,374,015.55 ₫
The Investment Profile 400

300

End of Period Cash Flows

200

Year Thing One Thing Two

Net Presetn Value

Today -1000 -1000 100
1 0 325
2 200 325
3 300 325 0
4 900 325 0.01 0.02 0.03 0.04 0.05

-100

IRR Thing One 10.172%

IRR Thing Two 11.388% -200

-300

Cost of capital 1% 2% 3% 4%
NPV Thing One 352.12 306.39 262.70 220.93
NPV Thing Two 268.14 ₫ 237.51 ₫ 208.06 ₫ 179.72 ₫
 NPV Profiles of Thing One and Thing Two

NPV Thing One NPV Thing Two

0.01 0.02 0.03 0.04 0.05 0.06 0.07 0.08 0.09 0.1 0.11 0.12 0.13 0.14 0.15 0.16 0.17 0.18 0.19 0.2

Required Rate of Return

5% 6% 7% 8% 9% 10% 11% 12% 13% 14%

180.99 142.77 106.18 71.14 37.57 5.396 -25.46 -55.06 -83.47 -110.74
152.43 ₫ 126.16 ₫ 100.84 ₫ 76.44 ₫ 52.91 ₫ 30.21 ₫ 8.29 ₫ -12.86 ₫ -33.30 ₫ -53.04 ₫
8 0.19 0.2

15% 16% 17% 18% 19% 20%

-136.94 -162.11 -186.30 -209.56 -231.94 -253.47
-72.13 ₫ -90.59 ₫ -108.45 ₫ -125.73 ₫ -142.46 ₫ -158.66 ₫
 Mutiple IRR

End of Period
Period Cashflow
0 $ -100
1 $ 260
2 $ 260
3 $ -490

IR 0% 1% 2% 3% 4% 5%
NPV $-70.00 $-63.29 $-56.93 $-50.92 $-45.22 $-39.83

IRR1 14.835%
IRR2 191.53%

$60.00

$40.00

$20.00
Net Present Value

$-
0% 6% 12% 18% 24% 30% 36% 42% 48%

$-20.00

$-40.00

$-60.00
N
$-40.00

$-60.00

$-80.00
 Chart Title
1.2

1
 Chart Title
1.2

0.8

0.6

0.4

0.2

0
1
 6% 7% 8% 9% 10% 11% 12% 13% 14%
$-34.73 $-29.90 $-25.33 $-21.00 $-16.90 $-13.03 $ -9.36 $ -5.89 $ -2.60

NET PRESENT VALUE

12% 18% 24% 30% 36% 42% 48% 54% 60% 66% 72% 78% 84% 90% 96% 102%108%114%120%126%132%138%144%150%156% 162%168%174%180%186%
Discount Rate
 15% 16% 17% 18% 19% 20% 21% 22% 23% 24%
$ 0.50 $ 3.44 $ 6.21 $ 8.84 $11.32 $13.66 $15.87 $17.95 $19.92 $21.77

E
NPV

50%156% 162%168%174%180%186%192%198%204%210%216%222%228%234%240%246%
 25% 26% 27% 28% 29% 30% 31% 32% 33% 34%
$23.52 $25.16 $26.71 $28.17 $29.53 $30.81 $32.02 $33.14 $34.20 $35.18
 35% 36% 37% 38% 39% 40% 41% 42% 43% 44%
$36.10 $36.95 $37.75 $38.48 $39.17 $39.80 $40.38 $40.91 $41.40 $41.84
 45% 46% 47% 48% 49% 50% 51% 52% 53% 54%
$42.24 $42.61 $42.93 $43.22 $43.48 $43.70 $43.90 $44.06 $44.19 $44.30
 55% 56% 57% 58% 59% 60% 61% 62% 63% 64%
$44.38 $44.44 $44.47 $44.48 $44.47 $44.43 $44.38 $44.31 $44.22 $44.12
 65% 66% 67% 68% 69% 70% 71% 72% 73% 74%
$44.00 $43.86 $43.71 $43.54 $43.36 $43.17 $42.97 $42.75 $42.52 $42.29
 75% 76% 77% 78% 79% 80% 81% 82% 83% 84%
$42.04 $41.78 $41.52 $41.24 $40.96 $40.67 $40.37 $40.07 $39.76 $39.44
 85% 86% 87% 88% 89% 90% 91% 92% 93% 94%
$39.12 $38.79 $38.46 $38.12 $37.77 $37.43 $37.07 $36.72 $36.36 $35.99
 95% 96% 97% 98% 99% 100% 101% 102% 103% 104%
$35.63 $35.26 $34.88 $34.51 $34.13 $33.75 $33.37 $32.98 $32.60 $32.21
 105% 106% 107% 108% 109% 110% 111% 112% 113% 114%
$31.82 $31.43 $31.04 $30.65 $30.25 $29.86 $29.46 $29.06 $28.67 $28.27
 115% 116% 117% 118% 119% 120% 121% 122% 123% 124%
$27.87 $27.48 $27.08 $26.68 $26.28 $25.88 $25.48 $25.09 $24.69 $24.29
 125% 126% 127% 128% 129% 130% 131% 132% 133% 134%
$23.90 $23.50 $23.10 $22.71 $22.31 $21.92 $21.53 $21.13 $20.74 $20.35
 135% 136% 137% 138% 139% 140% 141% 142% 143% 144%
$19.96 $19.57 $19.18 $18.80 $18.41 $18.03 $17.64 $17.26 $16.88 $16.50
 145% 146% 147% 148% 149% 150% 151% 152% 153% 154%
$16.12 $15.74 $15.36 $14.99 $14.61 $14.24 $13.87 $13.50 $13.13 $12.76
 155% 156% 157% 158% 159% 160% 161% 162% 163% 164%
$12.39 $12.03 $11.67 $11.30 $10.94 $10.58 $10.22 $ 9.87 $ 9.51 $ 9.16
 165% 166% 167% 168% 169% 170% 171% 172% 173% 174%
$ 8.81 $ 8.46 $ 8.11 $ 7.76 $ 7.41 $ 7.07 $ 6.72 $ 6.38 $ 6.04 $ 5.70
 175% 176% 177% 178% 179% 180% 181% 182% 183% 184%
$ 5.36 $ 5.03 $ 4.69 $ 4.36 $ 4.03 $ 3.70 $ 3.37 $ 3.04 $ 2.72 $ 2.39
 185% 186% 187% 188% 189% 190% 191% 192% 193% 194%
$ 2.07 $ 1.75 $ 1.43 $ 1.11 $ 0.79 $ 0.48 $ 0.17 $ -0.15 $ -0.46 $ -0.77
 195% 196% 197% 198% 199% 200% 201% 202% 203% 204%
$ -1.07 $ -1.38 $ -1.69 $ -1.99 $ -2.29 $ -2.59 $ -2.89 $ -3.19 $ -3.49 $ -3.78
 205% 206% 207% 208% 209% 210% 211% 212% 213% 214%
$ -4.07 $ -4.37 $ -4.66 $ -4.95 $ -5.24 $ -5.52 $ -5.81 $ -6.09 $ -6.37 $ -6.65
 215% 216% 217% 218% 219% 220% 221% 222% 223% 224%
$ -6.93 $ -7.21 $ -7.49 $ -7.77 $ -8.04 $ -8.31 $ -8.58 $ -8.86 $ -9.12 $ -9.39
 225% 226% 227% 228% 229% 230% 231% 232% 233%
$ -9.66 $ -9.92 $-10.19 $-10.45 $-10.71 $-10.97 $-11.23 $-11.49 $-11.74
 234% 235% 236% 237% 238% 239% 240% 241% 242%
$-12.00 $-12.25 $-12.51 $-12.76 $-13.01 $-13.26 $-13.50 $-13.75 $-14.00
 243% 244% 245% 246% 247% 248% 249% 250%
$-14.24 $-14.48 $-14.73 $-14.97 $-15.21 $-15.44 $-15.68 $-15.92
 VALUE TIED TO

Bond type Corporate Bond

Issuer Goldman Sachs Group Inc.
Ticker GS.AEH
Coupon rate 5.75%
Maturity
Ratings date 01/24/2022
Moody's/S&P/ A3/BBB+/A
Fitch
Price as % of Par 115.50%
value (Face value)
YTM = Yield to matur 2.757%

Whenever econ
th
Value of Bond
•1. If interest rate
•2. If interest rat
Value of a 5 years bond, FV = $1000, Coupon rate = 8%

Face value $ 1,000

Maturity 5 years
Frequency of
annually
payment
Nr of payments 5
$1,600.00
Couponrate 8%
$1,400.00

$1,339.74

Coupon $ 80
$1,282.81

$1,400.00

Value of
YTM
Bond
$1,200.00
0% $ 1,400.00
1% $ 1,339.74
2%
Value of the bond

$ 1,282.81 $1,000.00

3% $ 1,228.99
4% $ 1,178.07 $800.00
5% $ 1,129.88

$600.00
 Value of the b
$800.00

6% $ 1,084.25
$600.00
7% $ 1,041.00
8% $ 1,000.00
9% $ 961.10 $400.00

10% $ 924.18
11% $ 889.12 $200.00
12% $ 855.81
13% $ 824.14
14% $ 794.02 $-

0%

2%
15% $ 765.35

Face value $ 1,000

Frequency of annually
payment
Nr of payments
Couponrate 8%
Coupon $ 80
YTM 7%
Reminaing year Value of
bond
20 $ 1,105.94 $1,120.00

19 $ 1,103.36
18 $ 1,100.59 $1,100.00

17 $ 1,097.63
$1,080.00
16 $ 1,094.47
15 $ 1,091.08 $1,060.00
14 $ 1,087.45
13 $ 1,083.58 $1,040.00

12 $ 1,079.43
Valu

$1,020.00
11 $ 1,074.99
10 $ 1,070.24
$1,000.00
9 $ 1,065.15
8 $ 1,059.71 $980.00
7 $ 1,053.89
6 $ 1,047.67 $960.00

5 $ 1,041.00
$940.00
20 19 18 1
 $960.00

$940.00
4 $ 1,033.87 20 19 18 1

3 $ 1,026.24
2 $ 1,018.08
1 $ 1,009.35
0 $ 1,000.00

Face value 1000

Frequency of
payment annually
Nr of payments
$1,020.00
Couponrate 0.08
Coupon 80
YTM 0.09 $1,000.00

Value of
Reminaing year bond
$980.00
20 $ 908.71
19 $ 910.50
$960.00
18 $ 912.44
17 $ 914.56

Value
16 $ 916.87 $940.00
15 $ 919.39
14 $ 922.14
$920.00
13 $ 925.13
12 $ 928.39
11 $ 931.95 $900.00

10 $ 935.82
9 $ 940.05 $880.00
8 $ 944.65
7 $ 949.67
$860.00
6 $ 955.14 20 19 18

5 $ 961.10
4 $ 967.60
3 $ 974.69
2 $ 982.41
1 $ 990.83
0 $ 1,000.00
UE TIED TO BOND

Changes in interest rates

Whenever economists or investors refer to the interest rate on a financial asse
the interest rate they mean is the yield to maturity.
•1. If interest rates on newly issued bonds rise, the prices of existing bonds will
•2. If interest rates on newly issued bonds fall, the prices of existing bonds will

Changes in interest rates

Value of Bond

$1,600.00
$1,400.00

$1,339.74

$1,282.81

$1,400.00
$1,228.99

$1,178.07

$1,129.88

$1,084.25

$1,041.00

$1,200.00
$1,000.00

$961.10

$924.18

$889.12

$1,000.00
$855.81

$824.14

$794.02

$765.35

$800.00

$600.00
 $794.0
$824

$765.35
$8
$800.00

$600.00

$400.00

$200.00

$-

12%
0%

2%

4%

6%

8%

10%

14%
Yield to Maturity

Time Passage

Value of bond
$1,120.00

$1,100.00

$1,080.00

$1,060.00

$1,040.00

$1,020.00

$1,000.00

$980.00

$960.00

$940.00
20 19 18 17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 0

Period remaining
 $960.00

$940.00
20 19 18 17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 0

Period remaining

Value of bond
$1,020.00

$1,000.00

$980.00

$960.00

$940.00

$920.00

$900.00

$880.00

$860.00
20 19 18 17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 0

Periods Remainnig
n a financial asset,
rity.
sting bonds will fall
sting bonds will rise
$824.14

$794.02

$765.35
 $824

14% $794.0

$765.35

16%