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IoFA April 2007 Question 9

P

Pratik

Member
Dear All,

Unable to understand the logic behind the solution provided

Kindly assist...
 
The solution is quite long. Which bit or bits don't you understand? Also, which solution are you looking at - eg IFoA, ASET, revision notes? It really helps us to help you if you tell us this.
Thanks, Robert
 
Hello Richard, I'm also struggling with this question. Especially interpreting the cashflows. I'm looking at the solution from the revision notes.

Looking forward to your reply.

Thanks.
Tunji
 
It's very difficult to help if you won't say which part of the solution you don't understand.

One possible approach here is to draw six different timelines (each corresponding to one of the orders in which the three different key events could occur), and try to write down expressions for the cashflows corresponding to each of these orders.

Michael Hosking
 
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