Answered step by step
Verified Expert Solution
Link Copied!

Question

00
1 Approved Answer

Hello! Can you help me solve these questions, please! I'd appreciated! Thanks so much! Question1 A $100,000, 182-day T-bill is priced at $99,204 on its

Hello! Can you help me solve these questions, please! I'd appreciated!

Thanks so much!

Question1

A $100,000, 182-day T-bill is priced at $99,204 on its issue date. What simple interst rate will it yield to the purchaser if held until maturity? Calculate your answer to 2 decimal places, but don't include the % symbol.

Question3

An investor wishes to purchase a $100,000 T-bill 83 days before its maturity date at a price that will yield 3.00% simple interest.

Question2

You plan to invest $10,000 for 180 days. Your bank offers a rate of 2.60% on 90-day GICS and 2.80% on 180-day GICS.

How much more interest will you earn if you purchase a single 180-day GIC instead of two consecutive 90-day GICS? Remember that the interest earned from the first 90-day GIC will be invested in the second 90-day GIC along with the principal.

Express your answer to 2 decimal places but do not include the $ sign.

Question4

An investment contract promises two payments of $500, the first in 6 months and the second in 8 months. Calculate the value of the contract today if the required rate of return on the investment is 6.45%.

Question5

Calculate the maturity value of $13,000 placed in a 236-day term deposit paying an interest rate of 3.90%. Express your answer to 2 decimal places, but don't include the $ sign.

Question6

Rob borrowed $4,560 from Richard and signed a contract agreeing to pay it back 10 months later with 5.85% simple interest. After 3 months, Richard sold the contract to Chris at a price that would earn Chris 5.00% simple interest per annum. Calculate the price that Chris paid Richard.

Question7

Rob has $1,000 to invest for 120 days and is considering two options.

Option 1: He can invest the money in a 120-day GIC paying simple interest of 4.62%.

Option 2: He can invest the money in a 60-day GIC paying simple interest of 4.50% and then re-invest the maturity value into another 60-day GIC. What would the interest rate on the second 60-day GIC have to be for both options to be equivalent? Round your answer to two decimal places and don't include the % symbol.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Business Statistics A Decision Making Approach

Authors: David F. Groebner, Patrick W. Shannon, Phillip C. Fry

9th Edition

013302184X, 978-0133021844

Students also viewed these Finance questions

Question

2. Estimate the gains and costs of mergers to the acquiring firm.

Answered: 1 week ago