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for calculating tue treasury bill how did they get the 3000? For the main types of money market paper this occurs as follows: (1) Treasury

for calculating tue treasury bill how did they get the 3000?

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For the main types of money market paper this occurs as follows: (1) Treasury bills (TBs) Treasury bills are one type of debt instrument issued by the Treasury/government w borrows from the private sector during the course of the year to finance the budget d This occurs regularly, usually every Friday. A TB is issued as proof of the loan, and ite the holder/lender to receive a specified amount (the nominal or face value, e.g. R100 typically after 91 or 182 days. (The Treasury has also issued 273-day TBs.) Alternatively can say that the lender is a financial investor who buys the TB at a certain price. The interest that the lender/investor receives for the loan to the government (i.e. for financial investment in TBs) derives from the fact that she pays less than the R100 000 the TB. e.g. R97 000. This discount depends on the interest that the government is wil to pay, or that it has to pay in order to sell the TBs. The discount implies that, when the investor claims the full R100 000 after three monk she has earned a certain percentage nominal rate of return or nominal rate of interest this case, the '91-day TB rate'. For this example, the TB rate would amount to: 3 000 365 97 000 9 x 100 = 12.45% What are government bonds

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