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2. Answer the following questions. A Suppose you can purchase a $ 1 million Treasury bill that is currently selling on a discount basis at
2. Answer the following questions. A Suppose you can purchase a $ 1 million Treasury bill that is currently selling on a discount basis at 97.5 percent of its face value. The T-bill is 140 days from maturity. What are discount yield, and Bond equivalent yield? B Suppose you can purchase a $ 1 million negotiable CD that is currently 105 days from maturity. The CD has a quoted annual interest rate of 5.16 percent for a 360-day year. What are Bond equivalent yield? C Suppose a bank enters a reserve repurchase agreement in which it agrees to buy overnight funds from one of its correspondent banks at a price of $ 10,000,000 with the promise to sell these funds back at a price of $ 10,000,291.67 ($ 10,000,000 plus interest of $ 291.67) after five days. What is the yield on this repo
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