1 A $50,000, 74 day Province of Ontario T bill was issued 40 days ago What will the T bill sell at today, in order to yield the purchaser a simple interest rate of 3 50 p a 2 Jacqueline purchased a 182 day T bill with interest rate of 3 25 p a and a face value of $25,000 a How much did Jacqueline pay for the T bill b After 40 days, Jacqueline sold the T bill when the interest rate for this T bill in the market increased to 3 50 p a What was the selling price 3 David acquired a $9,000 00, 91 day, Province of Alberta T bill on its date of issue for a price of $8,900 15 What was the annual simple interest rate of the T bill 4 Robert owes $5,000 to a friend who is charging her simple interest of 3 75 p a She is required to settle the loan with two equal payments, one today and the other in six months Calculate the size of the equal payments using six months as the focal date 5 Hui won the lottery however, the lottery company gave her the following two options to receive her prize money Option (a) $11,000 in four months and $17,000 in eleven months Option (b) $7,000 immediately and $23,000 in fourteen months Assume that money earns 5 5 p a simple interest and use today as the focal date a What was the equivalent value of the payments under option (a) at the focal date b What was the equivalent value of the payments under option (b) at the focal date c Which option would be economically better for Hui and by how much Option (a) Option (b) is better by (Round to the nearest cent) 6 Christine had to make a payment of $1,550 in 11 months and $1,300 in 18 months, to a raw material supplier What single payment in 5 months would settle both these payments Assume a simple interest rate of 4 50 p a and use 5 months from now as the focal date 7 Jacqueline was supposed to pay David $6,400, 6 months ago, and $2,080, 5 months from now If she wants to reschedule these payments with two payments, one payment of $3,300 today and the balance 3 months from now, calculate the balance amount Assume that the simple interest charged is 4 50 p a and the agreed focal date is 3 months from now

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1. A $50,000, 74-day Province of Ontario T-bill was issued 40 days ago. What will the T-bill sell at today, in order to yield the

1. A $50,000, 74-day Province of Ontario T-bill was issued 40 days ago. What will the T-bill sell at today, in order to yield the purchaser a simple interest rate of 3.50% p.a.?

2. Jacqueline purchased a 182-day T-bill with interest rate of 3.25% p.a. and a face value of $25,000.

a. How much did Jacqueline pay for the T-bill?

b. After 40 days, Jacqueline sold the T-bill when the interest rate for this T-bill in the market increased to 3.50% p.a. What was the selling price?

3. David acquired a $9,000.00, 91-day, Province of Alberta T-bill on its date of issue for a price of $8,900.15. What was the annual simple interest rate of the T-bill?

4. Robert owes $5,000 to a friend who is charging her simple interest of 3.75% p.a. She is required to settle the loan with two equal payments, one today and the other in six months. Calculate the size of the equal payments using six months as the focal date.

5. Hui won the lottery; however, the lottery company gave her the following two options to receive her prize money:

Option (a): $11,000 in four months and $17,000 in eleven months.
Option (b): $7,000 immediately and $23,000 in fourteen months.

Assume that money earns 5.5% p.a. simple interest and use today as the focal date.

a. What was the equivalent value of the payments under option (a) at the focal date?

b. What was the equivalent value of the payments under option (b) at the focal date?

c. Which option would be economically better for Hui and by how much?

Option (a)

Option (b)

is better by ?(Round to the nearest cent)

6. Christine had to make a payment of $1,550 in 11 months and $1,300 in 18 months, to a raw material supplier. What single payment in 5 months would settle both these payments? Assume a simple interest rate of 4.50% p.a. and use 5 months from now as the focal date.

7. Jacqueline was supposed to pay David $6,400, 6 months ago, and $2,080, 5 months from now. If she wants to reschedule these payments with two payments, one payment of $3,300 today and the balance 3 months from now, calculate the balance amount. Assume that the simple interest charged is 4.50% p.a. and the agreed focal date is 3 months from now.