27. On April 28, 2020, an investor is considering an investment opportunity. He has determined that his investment horizon (i.e. the investment holding period) is only 90 days.

A negotiable certificate of deposit with a face value of $100,000 issued on January 2, 2020 has a term to maturity of 270 days. The investor can purchase this CD in the money markets on April 29, 2020, which is 117 days after the issue date. The yield on April 29, 2020 is 3.25%, and is expected to increase to 4.50% at the end of the investors investment horizon.

What is the yield to the investor if he chooses this Investment ?

Select one:

a. 5.07%

b. None of the choices are correct

c. 2.87%

d. 0.58%