An investor buys a T-bill with 180 days to maturity and $250,000 par value for $242,000....
An investor buys a T-bill with 180 days to maturity and $250,000 par value for $242,000. He plans to sell it after 60 days, and forecasts a selling price of $247,000 at that time. What is the annualized yield based on this expectation?
1) about 10.1 percent
2) about 12.6 percent
3) about 11.4 percent
4) about 13.5 percent
5) about 14.3 percent
Homework Answers
rate positively ... let me know if you need any clarification..
| annualized yield = (sales price - buy price)/Buy price *(365/number of holding days) | ||||||||
| =((247,000-242,000)/242,000)*(365/60) | ||||||||
| 12.6% | ||||||||
| therefore answer = | 12.6% | |||||||
Add Answer to:
An investor buys a T-bill with 180 days to maturity and $250,000
par value for $242,000....
8. An investor buys a T-bill at a bank discount quote of 4.80 with 150 days...
8. An investor buys a T-bill at a bank discount quote of 4.80 with 150 days to maturity. The investor's bond equivalent yield on this investment is A. 4.8% B. 4.97% C. 5.47% D. 5.74%
You are considering purchasing a T-bill that has 100 days to maturity, a par value of...
You are considering purchasing a T-bill that has 100 days to maturity, a par value of $100,000, and currently sells for $99,100. What is the bank discount yield on the instrument?
14. If an investor buys a $50,000, 90-day T-bill for $49,2 annualized return on a simple...
14. If an investor buys a $50,000, 90-day T-bill for $49,2 annualized return on a simple (arithmetic) basis is: n l( 50 and holds i ill maturity,the 15. A newly issued T-bill with a $10,000 par value that sells for $9,850 maturity has a discount return of c. at a discount from par value d, only through a financial intermediary 16. Both T-bills and paper are a, with a stated coupon rate b at a premium above par value 17....
A T-bill with face value $10,000 and 91 days to maturity is selling at a bank...
A T-bill with face value $10,000 and 91 days to maturity is selling at a bank discount ask yield of 3.8%. a. What is the price of the bill? (Use 360 days a year. Do not round intermediate calculations. Round your answer to 2 decimal places.) Price of the bill 9,906.17 b. What is its bond equivalent yield? (Use 365 days a year. Do not round intermediate calculations. Round your answer to 2 decimal places.) Bond equivalent yield 3.80 %
A T-bill with face value $10,000 and 79 days to maturity is selling at a bank...
A T-bill with face value $10,000 and 79 days to maturity is selling at a bank discount ask yield of 2.6%. a. What is the price of the bill? (Use 360 days a year. Do not round intermediate calculations. Round your answer to 2 decimal places.) Answer is complete but not entirely correct. Price of the $ 4,294.45 bill b. What is its bond equivalent yield? (Use 365 days a year. Do not round intermediate calculations. Round your answer to...
QUESTION ONE A 91 days treasury bill with a par value of K100 has been issued...
QUESTION ONE A 91 days treasury bill with a par value of K100 has been issued at a price of K97.55. Required: (a) Calculate the bond equivalent yield of the Treasury bill. (b) If the Treasury bill above was a 182 instrument, would the bond equivalent yield be more than or less than the bond equivalent yield calculated above? A 273 Treasury bill with a par value of K100.00 has a bond equivalent yield of 12.75%, which would be achieved...
A zero-coupon Treasury security (that is, a T-bill) has 50 days to maturity and a discount...
A zero-coupon Treasury security (that is, a T-bill) has 50 days to maturity and a discount yield of 4.2%. Calculate the effective yield for this security. (This is not the bond equivalent yield, but rather the equivalent of an EAR (effective annual rate).) Answer in percent terms to two decimal places. Do not enter the percent sign. Do not assume the inputs are the same as for the previous question. You can assume whatever face or par value you want,...
TOPC. X51) If an investor buys a 39-week T-bill with a maturity value of $25,000 for...
TOPC. X51) If an investor buys a 39-week T-bill with a maturity value of $25,000 for $23,543 what annual interest rate (annual yield) will the investor earn? (Express your answer as a percentage, correct to one decimal place.) *52) An investment company pays 7% compounded quarterly. What is the effective rate? (Compute the answer to two decimal places). 53) How much should you invest now at 6% compounded semiannually to have $8,500 to bu a car in 2.5 years? ve...
i need #4 and 5 3. A Treasury bill has a face value of $10,000, is...
i need #4 and 5
3. A Treasury bill has a face value of $10,000, is selling for $9,800, and matures in 78 days. i. What is its discount rate? (9.231%) ii. What is the bond equivalent yield (BEY) if you purchase the security now? (9.550%) ii, Suppose that you purchase this bill and held it for 60 days and then sell it for S9,954.846154. What is the yield on your investment? (9.612%) iv. What is the effective annual yield...
the low Managing in Financial Markets Money Market Portfolio Dilemma As the treasurer of a corporation,...
the low Managing in Financial Markets Money Market Portfolio Dilemma As the treasurer of a corporation, one of your jobs is to maintain investments in liquid securities such as Treasury securities and commercial paper. Your goal i to earn as high a return as possible but without takin much of a risk a. The yield curve is currently upward sloping, such that 10-year Treasury bonds have an annualized yield 3 percentage points above the annualized yield of three-month T-bills. Should...
8. An investor buys a T-bill at a bank discount quote of 4.80 with 150 days to maturity. The investor's bond equivalent yield on this investment is A. 4.8% B. 4.97% C. 5.47% D. 5.74%
14. If an investor buys a $50,000, 90-day T-bill for $49,2 annualized return on a simple (arithmetic) basis is: n l( 50 and holds i ill maturity,the 15. A newly issued T-bill with a $10,000 par value that sells for $9,850 maturity has a discount return of c. at a discount from par value d, only through a financial intermediary 16. Both T-bills and paper are a, with a stated coupon rate b at a premium above par value 17....
A T-bill with face value $10,000 and 91 days to maturity is selling at a bank discount ask yield of 3.8%. a. What is the price of the bill? (Use 360 days a year. Do not round intermediate calculations. Round your answer to 2 decimal places.) Price of the bill 9,906.17 b. What is its bond equivalent yield? (Use 365 days a year. Do not round intermediate calculations. Round your answer to 2 decimal places.) Bond equivalent yield 3.80 %
A T-bill with face value $10,000 and 79 days to maturity is selling at a bank discount ask yield of 2.6%. a. What is the price of the bill? (Use 360 days a year. Do not round intermediate calculations. Round your answer to 2 decimal places.) Answer is complete but not entirely correct. Price of the $ 4,294.45 bill b. What is its bond equivalent yield? (Use 365 days a year. Do not round intermediate calculations. Round your answer to...
QUESTION ONE A 91 days treasury bill with a par value of K100 has been issued at a price of K97.55. Required: (a) Calculate the bond equivalent yield of the Treasury bill. (b) If the Treasury bill above was a 182 instrument, would the bond equivalent yield be more than or less than the bond equivalent yield calculated above? A 273 Treasury bill with a par value of K100.00 has a bond equivalent yield of 12.75%, which would be achieved...
A zero-coupon Treasury security (that is, a T-bill) has 50 days to maturity and a discount yield of 4.2%. Calculate the effective yield for this security. (This is not the bond equivalent yield, but rather the equivalent of an EAR (effective annual rate).) Answer in percent terms to two decimal places. Do not enter the percent sign. Do not assume the inputs are the same as for the previous question. You can assume whatever face or par value you want,...
TOPC. X51) If an investor buys a 39-week T-bill with a maturity value of $25,000 for $23,543 what annual interest rate (annual yield) will the investor earn? (Express your answer as a percentage, correct to one decimal place.) *52) An investment company pays 7% compounded quarterly. What is the effective rate? (Compute the answer to two decimal places). 53) How much should you invest now at 6% compounded semiannually to have $8,500 to bu a car in 2.5 years? ve...
i need #4 and 5
3. A Treasury bill has a face value of $10,000, is selling for $9,800, and matures in 78 days. i. What is its discount rate? (9.231%) ii. What is the bond equivalent yield (BEY) if you purchase the security now? (9.550%) ii, Suppose that you purchase this bill and held it for 60 days and then sell it for S9,954.846154. What is the yield on your investment? (9.612%) iv. What is the effective annual yield...
the low Managing in Financial Markets Money Market Portfolio Dilemma As the treasurer of a corporation, one of your jobs is to maintain investments in liquid securities such as Treasury securities and commercial paper. Your goal i to earn as high a return as possible but without takin much of a risk a. The yield curve is currently upward sloping, such that 10-year Treasury bonds have an annualized yield 3 percentage points above the annualized yield of three-month T-bills. Should...
Most questions answered within 3 hours.
-
The number of major faults on a randomly chosen 1 km stretch of
highway has a...
asked 3 minutes ago -
Consider the competitive environment of Starbuck's, Progressive
Insurance, a manufacturing firm with low turnover, or a...
asked 50 minutes ago -
3. Gains from trade
Consider two neighbouring island countries called Euphoria and
Contente. They each have...
asked 2 hours ago -
A business executive has the option to invest money in two
plans: Plan A guarantees that...
asked 5 hours ago -
Hello, can someone please help me answer this question?
How much heat is absorbed by a...
asked 5 hours ago -
. A marketing researcher conducted a survey of 25 shoppers
randomly selected at the local mall...
asked 5 hours ago -
Create an comprehensive response to the
following:
Antimicrobial agents work on a multitude of microbes (bacteria,...
asked 5 hours ago -
6.13 LAB: Step counter. Section 6.3.
A pedometer treats walking 2,000 steps as walking 1 mile....
asked 5 hours ago -
(14.2) A block of mass m = 10 kg riding on a frictionless
horizontal plane is...
asked 5 hours ago -
Use any search engine to search for articles about Starbucks
partnership with Tata Companies in India...
asked 5 hours ago -
Let’s say that for some reason Bank Excess Reserves suddenly
increase sharply. What effect would this...
asked 5 hours ago -
Given:
Curent Assets: $600,000
Total Assets: $2,600,000
Current Liabilities: $500,000
Total Liabilities: $1,700,000
What is the...
asked 5 hours ago