What is the discount yield on this investment

Assignment Help Financial Management
Reference no: EM131519214

The treasurer of a large corporation wants to invest $45 million in excess short-term cash in a particular money market investment. The prospectus quotes the instrument at a true yield of 3.65 percent; that is, the EAR for this investment is 3.65 percent. However, the treasurer wants to know the money market yield on this instrument to make it comparable to the T-bills and CDs she has already bought. If the term of the instrument is 87 days, what is the discount yield on this investment? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places. Omit the "%" sign in your response.)

Reference no: EM131519214

Questions Cloud

Calculate operating breakeven point in units : Calculate the operating breakeven point in units. Use the degree of operating leverage? (DOL) formula to calculate DOL.
Data transmission technologies : Define each protocol and describe at least two data transmission technologies associated with the protocol. Include the bandwidth limitations of each technology
Describe the mechanisms involved in translating latent dream : Describe the mechanisms involved in translating latent dream content into manifest dream content
Explain fundamental lessons the ten principles of economics : Identify the fundamental lessons the Ten Principles of Economics teaches regarding: How people make decisions? How the economy works as a whole?
What is the discount yield on this investment : If the term of the instrument is 87 days, what is the discount yield on this investment?
Explain factors in personality development : Explain factors in personality development that have had the most influence on you and describe key personal experiences that explain your thinking
Explanation of the dichotomy between micro and macro : An explanation of "the dichotomy between micro and macro" practice. Then, describe how micro practice has come to dominate the social work profession
Write a discussion about the article : Read the article and write a discussion about the article. Information on any ambiguous of unknown term you needed to look up.
What value should michael put on investment opportunity : Michael Johnson has been given the opportunity of investing in a financial security that will pay him $600 in five years' time.

Reviews

Write a Review

Financial Management Questions & Answers

  Foreign company acquisition

Acquisition by a foreign company and the effects of that decision and the results of foreign exchange in Euro and the exchange rate differences.

  Financial management for profit and non profit organizations

In this essay, we are going to discuss the issues of financial management in a non-profit organisation.

  Method for estimating a venture''s value

Evaluate venture's present value, cash and surplus cash and basic venture capital.

  Replacement analysis

This document show the Replacement Analysis of modling machine. Is replacement give profit to company or not?

  Business finance task - capital budgeting

Your company is considering using the payback period for capital-budgeting. Discuss the advantages and disadvantages of this technique.

  Analysis of the investment

In this project, you will focus on one of these: the additional cost resulting from the purchase of an apple press (a piece of equipment required to manufacture apple juice).

  Conduct a what-if analysis

Review the readings and media for this unit, including the Anthony's Orchard case study media. Familiarise yourself with the Anthony's Orchard company and its current situation.

  Determine operational expenditures

Organisations' behaviour is guided by financial data. In the short term, such data will help determine operational expenditures; in the long term, historical data may help generate forecasts aimed at determining strategic plans. In both instances.

  Personal financial management

How much will you have left over each half year if you adopt the latter course of action?

  Sources of finance for expansion into new foreign markets

A quoted company is considering several long-term sources of finance for expansion into new foreign markets.

  Long term financial planning

This assignment is designed for analyze Long term financial planning begins with the sales forecast and the key input in the long term fincial planning.

  Explain the role of fincial manager

This assignment explain the role of fincial manager, function of manger. And what are the motives of financial manager.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd