Assume the face value of the treasury bill

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Suppose investors can earn a return of 2% per 6 months on a Treasury note with 6 months remaining until maturity. What price would you expect a 6-month maturity Treasury bill to sell for?

(Hint: Assume the face value of the Treasury bill is $1,000. And the Treasury note and the bill are both riskless assets and should earn same return for the same remaining maturity. Apparently, the bill will sell at discount).

Reference no: EM13847465

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