On a class of loans with a systematic amortisation schedule |
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| Authors: | Leif Hasager Bjarne Astrup Jensen |
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| Institution: | Institute of Finance , Copenhagen Business School , Rosen?rns Allé 31, Copenhagen V |
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| Abstract: | Abstract In this paper we show that a single set of formulas will characterise a wide range of standard loans. This makes it possible to describe these loans in a compact manner and facilitates the design of computer programs calculating their characteristics. The characterisation includes the entire amortisation schedule before and after tax and the duration and convexity measures. |
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| Keywords: | annuities serial loans consol bonds bullet loans bond payments convexity duration computer programs |
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