Question
1) If you purchase a T-Bill at a 3.20 discount with 80 days left to maturity, what is the price you will pay for this
1) If you purchase a T-Bill at a 3.20 discount with 80 days left to maturity, what is the price you will pay for this security? 2) You just bought a Bankers Acceptance with 165 days left to maturity. If you paid 98.360, what is the annual discount rate? 3) What is the CD equivalent yield on the BA in problem 2? 4) What is the bond equivalent yield on the T-Bill in question 1? 5) How much interest would you earn on a 3 day Repo for $1500000 at a rate of 2.35%? 6) XYZ Corporation issued a 10 year bond two years ago with a 5.75% coupon at par. If the current required return on this bond is 4.35%, what is the price of this bond? 7) Using all of the data from question #6, what would be the yield to call if this bond was called at the end of 5 years at a price of the coupon + par? 8) A bond is selling for a dollar price of 97.635. If this bond has an original maturity of 10 years, has been in the market for 18 months, and has a 4.50% coupon, what is the current required return? 9) If the bond in 8 were to remain in the market for 18 more months and rates on similar securities fell by 200 basis points, what would be the bond's new price?
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