Question 3 (14 marks / Money Market) Refer to the following two money market instruments: i. ii. a 60 day $10,000 CD (add on) quoted at 6% interest, and; a 180 day $10,000 T-bill (discount) quoted at 5.9%. (a) Calculate the initial price (PO) and face value (Pf) of the two instruments. (4 marks) (b) Calculate the bond equivalent yield of the two instruments. (4 marks) (c) Which instrument pays a higher bond equivalent yield? (2 marks) (d) In general, the market price of a T-bill is more volatile than a comparable CD in the secondary markets? Explain why this is true. (4 marks)