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You are an analyst in the Treasury department of Bennett Inc., a multinational firm. You have been tasked with answering questions the Treasurer has regarding
You are an analyst in the Treasury department of Bennett Inc., a multinational firm. You have been tasked with answering questions the Treasurer has regarding short-term investing and short-term borrowing. Below are numbers that your assistant has researched for you to answer these questions. Discount rate on company's Commercial paper 1.00% Discount rate on money market securities for investing 3.00%) Dealers annual fee percent on commercial paper 0.15% Marginal tax rate 35% Yield on Municipal bonds 2.00% Short-term portfolio beginning of year value 250000.00 Short-term portfolio end of year value 257000.00 Line of Credit with the Bank 350,000.00 Interest Rate on bank lending 5% Commitment Fee percentage on line of credit 0.50%) Compensating Balance percentage on line of credit 10% QUESTION 18 Suppose that a mistake was discovered in the commercial paper discount rate. The rate is actually 2% instead of 1%. By how much would the dollar discount change. O a. $9,375 O b. $18,750 O c $4,605 O d. $12,379
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