This is the printable version of the document
http://public.sheet.zoho.com/public/btzoho/hull-07-03-b
.
hull.07.03_b
Floater_Par
Proof: a floater is always worth par
Par:
$100
Coupon/
Cash Flow
Year
LIBOR
Coupon
Par
FV
PV
1
5%
$5.00
$5.00
$4.76
2
9%
$9.00
$9.00
$7.86
3
3%
$3.00
$100.00
$103.00
$87.37
100