3. A US Treasury bill has 180 days to maturity and a price of $9,600 per $10,000 face value. The bank discount yield of the bill is a 8%.

3.1. Calculate the bond equivalent yield for the Treasury bill. Show calculations (ignore skip day settlement)

3.2. Briefly explain why Treasury bill's bond equivalent yield differs from the discount yield.

4. Who sets the bid and asked price for a stock traded over the counter? Would you expect the spread to be higher on actively or inactively traded stocks?

5. If you place a stop-loss order to sell 100 shares of stock at $55 when the current price is $62, how much will you receive for each share if the price drops to $50?

a. $50

b $55

c. $54 7/8