A Firm plans to issue 90 day commercial paper with a par value of $5,000,000.00. It...
A Firm plans to issue 90 day commercial paper with a par value of $5,000,000.00. It expects to sell the commercial paper for $4,850,000.00 the yield it expects to pay investors is estimated to be
Homework Answers
Yield = [($5,000,000.00 - $4,850,000.00) / $4,850,000.00] × (360 / 90)
Yield = 0.1237 or 12.37%
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