The US government announced an auction of $10 million in 43-day T-Bills. They received non-compeitive bids for $3 million The compeititve bids were as follows : Amount Bid rates Cumulative Dealer A $2 million 1.75% 2 Dealer B $1 million 1.85% 3 Dealer C $0.5 million 1.90% 3.5 Dealer D $3 million 2.05% 6.5 Dealer E $2.5 million 2.15% 9 Dealer F $1.5 million 2.25% 10.5 Dealer G $2.75 million 2.30% 13.25 Dealer H $1.75 million 2.40% 15 At what interest rate will the auction be cleared?
The US government announced an auction of $10 million in 43-day T-Bills. They received non-compeitive bids for $3 million The compeititve bids were as follows : Amount Bid rates Cumulative Dealer A $2 million 1.75% 2 Dealer B $1 million 1.85% 3 Dealer C $0.5 million 1.90% 3.5 Dealer D $3 million 2.05% 6.5 Dealer E $2.5 million 2.15% 9 Dealer F $1.5 million 2.25% 10.5 Dealer G $2.75 million 2.30% 13.25 Dealer H $1.75 million 2.40% 15 At what interest rate will the auction be cleared?
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
| The US government announced an auction of $10 million in 43-day T-Bills. | ||||||
| They received non-compeitive bids for $3 million | ||||||
| The compeititve bids were as follows : | ||||||
| Amount | Bid rates | Cumulative | ||||
| Dealer A | $2 million | 1.75% | 2 | |||
| Dealer B | $1 million | 1.85% | 3 | |||
| Dealer C | $0.5 million | 1.90% | 3.5 | |||
| Dealer D | $3 million | 2.05% | 6.5 | |||
| Dealer E | $2.5 million | 2.15% | 9 | |||
| Dealer F | $1.5 million | 2.25% | 10.5 | |||
| Dealer G | $2.75 million | 2.30% | 13.25 | |||
| Dealer H | $1.75 million | 2.40% | 15 | |||
| At what interest rate will the auction be cleared? | ||||||
|
1.85% |
||
|
2.05% |
||
|
2.15% |
||
|
2.40% |
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