Based on the following information, answer the questions below. The time from acceptance to maturity on a $8 m Bankers Acceptance (BA) is 180 days. The importers banks acceptance commission is 5% and the market rate for 180 day BA is 9%.

A) What amount will the exporter receive if they hold the BA to maturity? Answer to the nearest cent. If your answer is $9 you must write as 9.00 (1 Mark)

B) What amount will the exporter receive if he discounts the BA? Answer to the nearest cent. If your answer is $9 you must write as 9.00 (1 Mark)

Note: the data contained in these questions is independent from that above

C) The discounted amount on a BA an exporter receives is $2.48m, the amount the exporter receives if they hold to maturity is $2.49m and the face value is $2.5m on a 90 day BA.

I) Determine the bond equivalent yield the importers bank will earn from discounting the BA with the exporter. Answer as a decimal to 4 decimal places. (2 Marks)

ii) Determine the bond equivalent yield the exporter receives from discounting the BA. Answer as a decimal to 4 decimal places. (2 Marks)