Compute the specified quantity. During a month, $5,000 6-month T-bills were sold at a discount rate of only 0.45%. What was its simple annual yield r? HINT [See Example 6.] (Round your answer to four decimal places. x %

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A: Rate for 2 weeks (r) = 0.22 or 22% Compound annual rate = ?

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A: Hi student Since there are multiple subparts, we will answer only first three subparts. If you want…

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A: Discount rate = 2.6%Number of days in a year = 365 daysCollection period = 36 days

Q: Calculate the simple interest earned. Round to the nearest cent. P = $5000, r = 6.8%, t = 25 days

A: Simple interest: As the name indicates it is a simple interest computed on the amount of principal.…

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Q: Suppose you saw a sign at your local bank that said, "4.3% rate compounded monthly- 4.7% Annual…

A: Effective Annual Rate is a modified rate of return where it considers the compounding effect.…

Q: What are the nominal and effective costs of trade credit under the credit terms of 2/20, net 35?…

A: Credit terms specify the rate of discount a business can obtain when full payment is made within the…

Q: If you borrow $4,600 at $850 interest for one year, what is your effective interest rate for the…

A: The Effective Annual Rate (EAR), also known as the annual equivalent rate (AER) or annual percentage…

Q: What is the annualized yield (rounded to three decimal places) on a seven-month U.S. Treasury bill…

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Q: Suppose your credit card issuer states that it charges a 17.00% nominal annual rate, but you must…

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Q: Assume inflation is 0.21% per month. Would you rather earn a nominal return of 0.72% per month,…

A: Real rate of return = ((1+Nominal rate of return)/(1+Inflation rate))-1

Q: Calculate the simple interest earned. Round to the nearest cent. P = $5000, r = 9.5%, t = 20 days

A: Simple Interest = P * r * t where, P = $5000, r = 9.5%, t = 20/365

Q: You would like to purchase a T-bill that has a $20,000 face value and is 309 days from maturity. The…

A: Discount yield = (Par value - current price) / par value  * 360 days / days to maturity

Q: nth. Round all values to the nearest cent. A. What is the finance charge for this first month? B.…

A: finance fee is the interest  pay on a loan you owe,If you carry a debt from one payment month to…

Q: You have estimated spot rates as follows: r₁ = 6.10%, r₂ = 6.50 % , r3 = 6.80 %, r4 = 7.00%, r5 =…

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Q: W WA Finance 2-Borrowing Money and Pa Assume that you take out a $4000 loan for 30 months at 8.5%…

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Q: ts, which amounts to monthly compounding. What is the effective annual rate?   a. 24.23%

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Q: hat is the effective interest rate of a simple discount note for $27,500​,at an ordinary bank…

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A: Exponential Decay: A mathematical process that is being used to reduce a certain amount by a…

Q: Find the annual percentage yield (APY) in the following situation. A bank offers an APR of 4.05%…

A: The APR does not take into consideration the impact of the compounding frequency. It is simply the…

Q: If a firm buys under terms of 3/15, net 30, but actually pays on the 20th day and still takes the…

A: Companies gives discount to the customers for early payments to customers but that is cost to…

Q: Suppose you saw a sign at your local bank that​ said, ​"3.3​% rate compounded quarterly – 3.7​%…

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Q: If a firm buys under terms of 1/15, net 40, but actually pays on the 20th day and still takes the…

A: 1/15, net 40 means that the supplier will give an additional discount of 1% to the buyer if the…

Q: ou currently have $200 in the bank which pays a 5% pa interest rate. Apples currently cost $1 each…

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Q: A 6-month $3000 Treasury bill with discount rate 6.843% was sold in 2009. Find a. the price of the…

A: Treasury bill or T- bill It is issued by the government of India.  It is the type of security used…

Q: Calculate the simple interest earned. Round to the nearest cent. P = $9080, r = 5.25%, t = 4 months

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Q: You would like to purchase a Treasury bill that has a $16,500 face value and is 62 days from…

A: Face value (F) = $16500 Price (P) = $16375 n = 62 days

Q: What is the approximate annual cost of foregoing the cash discount if the credit term is 2/15, net…

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Q: Yield Calculation i. Assume that newly issued three- month (90 days) T - bills with a par value of…

A: As per company guideline, first three parts will be solved.

Q: Nominal cost of trade credit:   % Effective cost of trade credit:   %

A: Nominal cost of trade credit = = [(Discount % / 100 - Discount %) *(365 / (Days credit outstanding -…

Q: At auction, 2-month T-bills were sold at a discount of 6.530%. What was the simple annual yield r?

A: Given,  time t = 2 months i.e. 2/12 = 1/6 Discount = 6.53% Let the face value be $100 Discount =…