Interest rate on a federally insured deposit declines

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Assume that the interest rate on a federally insured deposit declines from 15 percent per annum to 10 percent. If an individual holding a U.S. Treasury bill worth $2,500 plans to sell it after this drop in interest rate, he would realize (approximately) a:

a. capital loss worth $100.

b. capital gain worth $99.

c. capital gain worth $100.

d. capital loss worth $99.

Reference no: EM131173816

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