Brian and Lea are considering buying treasury bills. Brian wants to buy a Canadian Treasury Bill that has an effective annual yield equal to 5.5% and 180 days to maturity. Lea wants to buy a US Treasury Bill that has an effective annual yield equal to 6.6% and 140 days to maturity. A. What is the bond equivalent yield on the Treasury Bill purchased by Brian? ( 2.5pts) B. What is the bank discount yield on the Treasury Bill purchased by Lea? (2.5 pts) C. If Brian manages to sell the bill for $890 after 50 days from the purchase time, what would be his holding period return? (2.5pts) D. If Lea keeps the Bill till maturity, what would be her holding period return? (2.5 pts) E. If Brian manages to sell the bill for $P after 140 days from the purchase time, at what price should Brian sell the bill so that he can achieve the same holding period return as Lea (assuming Lea hold her treasury bill to maturity)? (2.5 pts) Problem 2 (16 pts) We want to form an index using the five stocks presented in the below table: A. Calculate the rate of return on an equally weighted index for the first period (from t=0 to t=1 ) if stock-D price at the end of period 1(P1,D) is equal to $42?(3pts) B. Calculate the rate of return on an price weighted index for the first period (from t=0 to t=1 ) if stock-D price at the end of period 1(P1,D) is equal to $55 ? (3 pts) C. What should be stock D price by the end of period 1(P1,D) if the value-weighted index (marketcapitalization weighted index) rate of return for the first period (from t=0 to t=1 ) is equal to 10% ? (5 pts) D. Assume that stock-D price at the end of period 1(P1,D) is equal to $30. If now (at t=0), you invest $5,000 in an index fund ABC that is tracking the performance of the value-weighted index formed from the above five stocks. Your Friend, Zach, invest $5,000 in an index fund XYZ that is tracking the performance of the price-weighted index formed from the above five stocks. How much money will you have more (or less) than Zach after one period (at t=1) ? ( 5pts )