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A bank has issued a six-month, $2.6 million negotiable CD with a 0.52 percent quoted annual interest rate (iCD, sp). a. Calculate the bond equivalent
A bank has issued a six-month, $2.6 million negotiable CD with a 0.52 percent quoted annual interest rate (iCD, sp). a. Calculate the bond equivalent yield and the EAR on the CD. b. How much will the negotiable CD holder receive at maturity? c. Immediately after the CD is issued, the secondary market price on the $3 million CD falls to $2,598,700. Calculate the new secondary market quoted yield, the bond equivalent yield, and the EAR on the $2.6 million face value CD. Complete this question by entering your answers in the tabs below. Required A Required B Required C Calculate the bond equivalent yield and the EAR on the CD. (Use 365 days in a year. Do not round intermediate calculations. Round your answers to 3 decimal places. (e.g., 32.161)) Bond equivalent yield % EAR %
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