Find the discount yield and bond equivalent yield

Assignment Help Financial Management

Reference no: EM132021871

A T-bill that is 205 days from maturity is selling for $95,870. The T-bill has a face value of $100,000.

a. Calculate the discount yield, bond equivalent yield, and EAR on the T-bill. (Use 360 days for discount yield and 365 days in a year for bond equivalent yield and effective annual return. Do not round intermediate calculations. Round your answers to 2 decimal places. (e.g., 32.16))

Discount yield %

Bond equivalent yield %

EAR %

b. Calculate the discount yield, bond equivalent yield, and EAR on the T-bill if it matures in 280 days. (Use 360 days for discount yield and 365 days in a year for bond equivalent yield and effective annual return. Do not round intermediate calculations. Round your answers to 2 decimal places.(e.g., 32.16))

Discount yield %

Bond equivalent yield %

EAR %

Reference no: EM132021871

Questions Cloud

How to create a portfolio that creates arbitrage : Further let the correlation coefficient between the returns of A and B be equal to -1 (?A,B = -1). Lastly, let the risk-free rate be 3% (rf = 3%).

Suspect of having a linear relationship : Two variables on the individuals in that population whose values you suspect of having a linear relationship in that population.

What would the annual yield to maturity be on : Sweet Fruit, Inc. has a $1.000 par value bond that is currently selling for $1, 280 II has an annual coupon rate of 9 90 percent, paid semiannually.

Set of defective systems in the next computer : How do I find the possible outcomes for the set of defective systems in the next computer.

Find the discount yield and bond equivalent yield : Calculate the discount yield, bond equivalent yield, and EAR on the T-bill if it matures in 280 days.

Onset of the storm season : You are a storm chaser who needs to have your team and equipment in place at the onset of the storm season. In order to be able to observe as many storms.

What is this stock worth to you per share : Can't Hold Me Back, Inc. is preparing to pay its first dividends. It is going to pay $1.00, $2.50, and $5.00 a share over the next three years, respectively.

What percentage of the scores were at or below : Angela took a general aptitude test and scored in the 83rd percentile for aptitude in accounting.

Determine the market or book ratio : Symphony Corp.'s stock price at the end of last year was $72.70, and the company's book value per share was $35.17.

User Account

All Pages