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Hello, I have the problem below. My question is this: I don't know what does 325 basis points mean and also I don't understand in
Hello, I have the problem below.
My question is this: I don't know what does "325 basis points" mean and also I don't understand in the denominator 365 + (0.1025 x 90), what is 0.1025 and how did they get it?
Thank you.
Example 2: A company needs ongoing S/T funds of 1.5M & a bank agrees to arrange a bank bil facility & issue 90-day bills at current market yields of 7% 325 basis points for issuing fees. How much will company first raise by issuing directly a bank bill? face value x days in year Price days in year t yield x to maturity days 100 Initial funds for firm 1,500,000x 365 365+ (0.102 5x90) $1,463,023Step by Step Solution
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