(a)Calculate the bond equivalent yield and effective annual return on a negotiable CD that is 68 days from maturity and has a quoted nominal yield of 3.4%.

(b) If $ 1 million is invested in this CD, how much (in $s) will the investor receive at maturity?

(c) Immediately after the CD is issued, the secondary market price on the $1 million CD rises to $1,003,000. Calculate the new secondary market quoted yield (i spy), the bond equivalent yield, and the EAR on this CD.

(use financial calculator)