a.A borrower requires $1,000,000 today to pay for some inventory. A bank is prepared to provide the financing in form of a 270-day bank accepted commercial bill at a yield of 3.95% p.a. How much would the company have to pay back in 270 days time?

b.A commercial bill is an example of what is referred to as a discount security. Explain what is meant with a discount security and what are the markets into which it is issued? How does an investor make money on such securities? Identify 2 other discount securities in addition to commercial bills?