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    sasham's Avatar
    sasham Posts: 24, Reputation: 1
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    #1

    Sep 20, 2009, 07:47 PM
    Duration
    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's Avatar
    ArcSine Posts: 969, Reputation: 106
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    #2

    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?
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