: What is the bond equivalent yield on a Treasury-bill with a face value of $3,000000, a discount rate of 3% and 40 days until maturity? b: What does VAR(95%) of $32,000 mean? c: Use the following to calculate the effective borrowing cost of commercial paper • Face value = 19,000,000 • Discount rate = 0.5% • Dealer Fee = 0.2% • Commitment Fee = 0.17% • Days to maturity = 50
: What is the bond equivalent yield on a Treasury-bill with a face value of $3,000000, a discount rate of 3% and 40 days until maturity? b: What does VAR(95%) of $32,000 mean? c: Use the following to calculate the effective borrowing cost of commercial paper • Face value = 19,000,000 • Discount rate = 0.5% • Dealer Fee = 0.2% • Commitment Fee = 0.17% • Days to maturity = 50
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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a: What is the bond equivalent yield on a Treasury-bill with a face value of $3,000000, a discount rate
of 3% and 40 days until maturity?
b: What does VAR(95%) of $32,000 mean?
c: Use the following to calculate the effective borrowing cost of commercial paper
• Face value = 19,000,000
• Discount rate = 0.5%
• Dealer Fee = 0.2%
• Commitment Fee = 0.17%
• Days to maturity = 50
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