A discounted Certificate of Deposit with a face value of USD 2.5 million issued for a period of 90 days at a rate of 3.5%.

1. Between the buyer and issuer, who receives and who parts with money

2. What is the price at which this CD is transacted?

3. The CD is sold 45 days later at a rate of 3.75%. What is the selling price? Explain the two components generating the difference with the first price found.

4. How much would the CD be worth if it was held until the day of its maturity and the rate for 90 days on that day would be 3.80%