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sasham
Sep 20, 2009, 07:47 PM
Is Duration better way to compare cash flows than simply comparing present values because Duration incorporates cash flow volatility or because Duration effectively treats cash flows as a perpetuity ,incorporating the reinvestment rate?

ArcSine
Sep 21, 2009, 04:24 AM
You've read the homework help rules... so check back in with your thoughts on the question. While you're at it, think about this: What is Duration's primary purpose?