Question one:

A Treasury STRIPS is quoted at 54.789 and has 8 years until maturity. What is the yield to maturity?

Question two:The treasurer of a large corporation wants to invest $12 million in excess short-term cash in a particular money market investment. The prospectus quotes the instrument at a true yield of 6.28 percent; that is, the EAR for this investment is 6.28 percent. However, the treasurer wants to know the money market yield on this instrument to make it comparable to the T-bills and CDs she has already bought. If the term of the instrument is 120 days, what are the bond equivalent and discount yields on this investment?

Bond Equivalent Yield____%?

Discount Yield____%?

I been going through all my notes and nothing is helping me with these problems.

I would appreciate if someone can show me the steps of how to do each solution.