Suppose XYZ bank enters a reverse repurchase agreement in which it agrees to buy Treasury Securities from another financial institution at a price of $12,000,000, with the promise to sell these funds back at a price of $12,000,000 plus interest of $2000 after five days. The yield on this repo to the XYZ bank is calculated as follows:

Select one:

a. 1.216%

b. 1.20%

c. 0.12%

d. 1.22%

e. None of the above