On 2022-04-22, Jiefei pays $17,908.48 for a Tbill with a face value of $19,000.00 and a maturity of 2023-02-21. He computes both the corresponding simple discount rate d, and the simple interest rate r. True or false: r > d. Select one: O True O False Certainty OC=1 (Unsure: <67%) OC=2 (Mid: >67%) OC=3 ( Quite sure: >80%)

On 2022-04-22, Jiefei pays $17,908.48 for a Tbill with a face value of $19,000.00 and a maturity of 2023-02-21. He computes both the corresponding simple discount rate d, and the simple interest rate r. True or false: r > d. Select one: O True O False Certainty OC=1 (Unsure: <67%) OC=2 (Mid: >67%) OC=3 ( Quite sure: >80%)

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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Suppose that you purchase the t bill maturing on November 18 2023 for $9993.793. The T bill matures 133 days aftef the settlment date july 9 2023 and has a face value of $10000. What is the T bill asked discount yield?
You submit a noncompetitive bid in Dec. 2020 to purchase a 28-day RM1,000 Treasury bill, and you find that you are buying the bond for RM999.88722. What are the: a) discount rate % b) investment rate %?
Suppose you work as a broker in an investment company, and there is an expectation that the market interest rate will be 0.029. based on this expectation you are required to calculate the market price for the following CD;Issue date: 1 January 2021 Maturity date:10 May 2021. The face value OMR 10000. Interest on CD: 5 percent. Select one: a. 15942.02 b. 15574.10 c. 15677.97 d. All the given choices are not correct e. 15572.50
On January 1, 2022, Slack Company finished legal services and accepted in exchange a 5% $400,000 promissory note with a due date of December 31, 2024. Interest is receivable on January 1 of each year. Notes with similar risk have a market rate of interest of 10%. Set financial calculators to zero decimal place. Required: (a) Determine the value of the following: N = I/Y = PMT = FV = (b) The present value of the note was (c) Prepare a Schedule of Note Discount/Premium Amortization for Slack Company under the effective interest method.
An investment bank sells securities under a repurchase agreement for $800.438 million and buys them back in 7 days for $800.568 million. What is the repo's single payment yield?Report your answer in % to the nearest 0.01%;
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In a discount interest loan, you pay the interest payment up front. For example, if a 1-year loan is stated as $34,000 and the interest rate is 9.50%, the borrower “pays” 0.0950 × $34,000 = $3,230 immediately, thereby receiving net funds of $30,770 and repaying $34,000 in a year. A. What is the effective interest rate on this loan? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) B. What is the effective annual rate on a 1-year loan with an interest rate quoted on a discount basis of 19.50%? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)
Suppose that you purchase the T-bill maturing onOctober 24, 2013, for $9,998.599. The T-bill matures123 days after the settlement date, June 23, 2013, andhas a face value of $10,000. What is the T-bill’s askeddiscount yield.(10,000-9,998.599)/9,998.599 = the answer to this is 0.00014012 but I am not getting this? Can you tell me step by step how to get this answer?
Pierre Company has a 12% note payable with a carryingvalue of $20,000. Pierre applies the fair value option tothis note. Given an increase in market interest rates, thefair value of the note is $22,600. Prepare the entry torecord the fair value option for this note, assuming (a) nochange in credit risk, and (b) the change is due to achange in credit risk.
What’s the equivalent interest rate to the terms 3/20, n/60? In other words, what is the effective annual rate that is "given" to a customer for this cash discount? (Use 365 days.) HINT: Use the I = P x R x T formula where R = I/PT and choose some value for the gross amount of the invoice (i.e $1,000). Label (%) and round to the nearest whole percent.
Chen buys a T-bill with a face value of $10,000.00 on 2021-05-12 that matures on 2021-10-29. The annual simple interest rate is 1.875%, and the daycount convention is ACT/365. What price P does he pay? a. P = $9,917.76. b. P = $9,874.47. c. P = $9,913.43. d. P = $9,883.13. e. P = $9,909.10.
Today is the 10th January 2023. You want to buy a Floating Rate Note (FRN) that matures on the 10th July 2027 and pays an annual coupon equal to LIBOR. Compute the fair price of the note. Use the data in Table 1. The LIBOR rate at selected dates are showed in Table 3. Please show your calculations. Discuss your result. Rates are continuously compounded- see attached image

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