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What would pay for commercial paper with a face value

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Reference no: EM131750426

Question: (a) What would you pay for commercial paper with a face value of $100,000 and a maturity of 182 days if you wanted to achieve an effective annual yield of 18 percent?

(b) Assume that market interest rates remain stable during the next 6 months. Plot the market value of this commercial paper as a function of the days remaining to maturity, and briefly explain your findings.

Reference no: EM131750426

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