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such that if you take the present value of that same coupon payment forever
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it's just going to be worth 100 which is that number.
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And how do you figure out the coupon payment?
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Well, you do it by backward inductions.
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Figure out the present value.
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Do it by backward induction just as we did.
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But we've gotten a lot of information.
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We've gotten this number at every period.
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So by doing it by backward induction instead of just doing the long exponential calculation,
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by doing it by backward induction
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we've produced the present value at every time in the future.
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Now, that's an incredibly important number in mortgages.