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Please ONLY DO 7) and show work, thank you! 6) A 180 day T-bill interest ask price is 6%. a) Find the discount amount in
Please ONLY DO 7) and show work, thank you!
6) A 180 day T-bill interest ask price is 6%. a) Find the discount amount in dollars per 100 face. b) What is the price on the invoice for $10,000 face?
So, Face Value = 100, Disc Yield = .06, Maturity = 180 days.
A) Answer: Discount = Face Value * Discount Yield * (180/360)
A) Answer: $3
B) Answer: Discount Yield = (FV - Price)/FV * (180/360)
B) Answer: $9700
7) For the previous problem (180 days), find effective rate of return using the compound effective rate calculation.
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