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Suppose that you purchased a 26-week T-bill at $998 (assuming the face value is $1,000). Now the asked bank discount rate on this T-bill is
Suppose that you purchased a 26-week T-bill at $998 (assuming the face value is $1,000). Now the asked bank discount rate on this T-bill is 0.04 and there are five weeks to maturity. What is the price of the T-bill now? (10 pts) 1) 2) If you hold the T-bill from initial purchase until maturity, what will be your rate of return? (10 pts)
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