An investor purchased a 91-day, $10,000.00 T-bill on its issue date for $9920.38. After holding it for 34 days, she sold the T-bill for a yield of 2.41%.(a) What was the original yield of the T-bill?(b) For what price was the T-bill sold?(c) What rate of return (per annum) did the investor realize while holding this T-bill?(a) The original yield of the T-bill was 3.21 %.(Round the final answer to two decimal places as needed. Round all intermediate values to six decimal places as needed.)(b) The T-bill sold for $.(Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed.)(c) The investor realized a rate of return of %.(Round the final answer to two decimal places as needed. Round all intermediate values to six decimal places as needed.)

Treasury bills (T-bills) are the money market instruments issued by the government as a promissory…

An investor purchased a 91-day, $10,000.00 T-bill on its issue date for $9920.38. After holding it for 34 days, she sold the T-bill for a yield of 2.41%. (a) What was the original yield of the T-bill? (b) For what price was the T-bill sold?

An investor purchased a 91-day, $10,000.00 T-bill on its issue date for $9920.38. After holding it for 34 days, she sold the T-bill for a yield of 2.41%. (a) What was the original yield of the T-bill? (b) For what price was the T-bill sold?

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Question

100%

An investor purchased a 91-day, $10,000.00 T-bill on its issue date for $9920.38. After holding it for 34 days, she sold the T-bill for a yield of 2.41%.
(a) What was the original yield of the T-bill?
(b) For what price was the T-bill sold?
(c) What rate of return (per annum) did the investor realize while holding this T-bill?
(a) The original yield of the T-bill was 3.21 %.
(Round the final answer to two decimal places as needed. Round all intermediate values to six decimal places as needed.)
(b) The T-bill sold for $.
(Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed.)
(c) The investor realized a rate of return of %.
(Round the final answer to two decimal places as needed. Round all intermediate values to six decimal places as needed.)

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