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The following table shows a partial listing of T-bills from the Wall Street Journal Outline. Rather than providing prices of each bill, the financial press
The following table shows a partial listing of T-bills from the Wall Street Journal Outline. Rather than providing prices of each bill, the financial press reports yields using the bank-discount method. The face value of T-bill is $10,000. Bid (%) Treasury Bills August 6, 2021 Maturity 9/2/2021 9/9/2021 9/16/2021 9/23/2021 0.040 0.045 Asked (%) 0.030 0.035 0.043 0.033 0.048 0.038 Consider the bill maturing on September 16, 2021. a. What is the price at which the dealer is buying assuming days to maturity are 41 days? b. What is its bond equivalent yield
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