1. (0.75 pts.) A $100,000 face value T-bill matures in 75 days and has a Bond Equivalent Yield (BEY) of 5.57%. What is the current value (price) of the bond?

2. (1 pts) Suppose there are only three stocks in the market and the following information is given:

Company	Shares Outstanding	Price per Share
A	10 million	$60
B	30 million	$40
C	20 million	$50

2.1 (0.25 pts.) What is the weight of Stock A in the price-weighted index?

2.2 (0.75 pts.) Suppose the current divisor is 2.5. If the next day, stock A undergoes a 2-for-1 stock split, what is the new post-split divisor for the price-weighted index?

Lecture 3 Questions:

3. (0.75 pts.) Tori purchased 500 shares of Flagler Enterprises stock at a price of $25 a share. The initial margin was 60% and the maintenance margin is 35%. After the purchase, the stock price drops to $22. What is the margin now (ignore interest)? Will this trigger a margin call?

4. (0.75 pts.) You invested in stock ABC at $50 per share. The purchase was made with 60% margin at 10% annual interest rate on the borrowing. You sold your shares one year later at $60 per share. What is your holding period return?

5. (0.75 pts.) You short sold stock XYZ at $20 per share at an initial margin of 50%; and collected $200,000 sale proceeds. The broker requires maintenance margin of 30%. If the price increases to $25, would it trigger a margin call?

Note: Please make sure to show your work.