$1.$ Explain why Treasuries of the same risk tend to sell for a lower yield than corporates of the same risk. Explain why municipals of the same risk tend to sell for a lower yield than either corporates or Treasuries. Anam

$2.$ An investor buys a face amount $$1$ million of a six$-$month $(182$ days$)$ Treasury bill at a discount yield of $9\mathrm{.}25$ percent.

$($a$)$ What is the cost of purchasing these bills? Use both a formula and the inbuilt excel function.

$($b$)$ Calculate the bond equivalent yield. Indicate clearly the formula you used and show all the steps in your calculations. Recalculate the bond equivalent yield if the T$-$bill has a maturity of $275$ days.