Westpac arranges financing for Super Duper Pty Ltd with a 90 day bank bill with a Face Value of $500,000. City Investments buy the bill when it is fırst issued at a yield of 4.55% pa and sell it 30 days later to Prudential Investments at a yield of 4.95% pa. What price does Super Duper sell the bill for? $494,452.65 $500,000.00 $505,609.59 $478,240.08 $493,970.85
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- Westpac arranges financing for Super Duper Pty Ltd with a 90 day bank bill with a Face Value of $500,000. City Investments buy the bill when it is first issued at a yield of 4.55% pa and sell it 30 days later to Prudential Investments at a yield of 4.95% pa. What price does Prudential Investments buy the bill for? a. $496,288.04 b. $476,417.34 c. $500,000.00 d. $497,974.00 e. $495,964.34An 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%;Hong Corporation issues P500,000, 20 percent, 120-day commercial paper. However, the funds are needed for only 90 days. The excess funds can be invested in securities earning 19 percent. The brokerage fee for the marketable security transaction is 1.0 percent. What is the net cost to the company for issuing the commercial paper? choose the letter of the correct answera. P10,416.00b. P15,416.00c. P20,416.00d. P25,416.00e. P30,416.00
- A bank enters a reverse repurchase agreement in which it agrrrd to buh T bills from one of its correspondent banks at a price of $10000 with the promise to sell these funds bank at a price of $ 10000, 291.67 ( $10 000 000 plus interest of $ 291.67) after five days. What will be the yield on this transactionAngela made an 180-day investment arrangement involving two consecutive 90 day $100,000 bank bills. The maturity proceeds of the first bill will be used to purchase the second bank bill. The remain surplus cash after 90 days will be invested at 2.129% p.a. simple interest rate. The yield rate of first bank bill is 2.477% p.a. simple interest rate and the yield rate of second bank bill is 2.725% p.a. simple interest rate. a) What is price of first bank bill? Round your answer to three decimal places.Jewel Regal Cars (JRC) must raise $240 million to support operations. To do so, JRC plans to issue new bonds. Investment bankers have informed JRC that the flotation costs will be 4% of the total amount issued. If the market value of each bond is $1,000, how many bonds must JRC sell to net the $240 million that it needs? There are no other issuing expenses or fees in the offering.
- Cross Country Railroad Co. is about to issue $100,000 of 10-year bonds that pay a 5.5% annual interest rate, with interest payable semi-annually. The market interest rate is 5%. How much can Cross Country expect to receive for the sale of these bonds? To calculate, use (a) the present value tables, (b) a financial calculator, or (c) Excel function PV. (Unknown Rate) HQ Ltd. purchased a used truck from Trans Auto Sales Inc. HQ paid a $4,000 down payment and signed a note that calls for 36 payments of $1,033.34 at the end of each month. The stated rate of interest in the note is 4%. As an incentive for entering into the contract, Trans has agreed to forgive the first two payments under the lease.InstructionsWhat was the purchase price of the used truck excluding the incentive given? To calculate, use (1) a financial calculator or (2) Excel function PV.What effect, if any, does the forgiveness of the first two payments have on the purchase price of the truck?Calculate the present value of…A writer sells 100 call options with strike $46 for $0.94 each and deposits these premiums in a bank. The calls mature in 30 days, and the bank's interest rate over those 30 days is 3%. At expiry the underlying asset of the call is worth $39 each. At expiry, the writer withdraws all cash from the bank, purchases the necessary amount of shares on the open market and completes the call contract. What is the writer's profit? Give your answer correct to two decimal places, and if the writer makes a loss include a minus sign.Suppose a bank enters a repurchase agreement in which it agrees to buy Treasury securities from a correspondent bank at a price of $14,800,000, with the promise to buy them back at a price of $15,000,000. Calculate the yield on the repo if it has a 36-day maturity. (Do not round intermediate calculations. Round your answers to 4 decimal places. (e.g., 32.1642))
- Standard bank has assets of $ 150 million, liabilities of $ 135 million and equity of $ 15 million. It asset duration is six years and the duration of the liabilities is for four years. Standards bank wishes to hedge the balance sheet with 20-year T-bond futures contracts, witch are currently trading at $95 per $100 face value and duration of 10.37 year. Note that T-bond futures are sold in $100000 face value per contract. What is the duration gap of Standard Bank? A.2 years B.3.2 years C.2.4 years D.-2.4 yearsSuppose a bank enters a repurchase agreerment in which it agrees to sell Treasury securities to a correspondent bank at a price of $9.99,838 with the promise to buy them back at a price of $10.000,073. Calculate the yield on the repo if it has a 6-day maturity. (write your answer in percentage and round it to 2 decimal places)Compañía CSB, S.A., requires short-term financing and requests a loan from Banco del Comercio, and proposes to guarantee it with inventories, for an amount of US$ 500,000.00. The bank accepts the proposal, with the following credit conditions: Credit conditions: a) Term 1 year b) He receives the inventories for a value of 90% of the value c) Charges you a 3% disbursement fee d) the interest rate is 20% per year e) The costs related to the mobilization of inventories are borne by Meyer Co., which are 3% of 100% of the value of the inventories. All costs involved must be covered in advance and will be deducted at the time of disbursement. It is requested: 1.- Determine the amount of the credit 2.- Calculate each cost involved in the transaction 3.- Determine the total amount of costs 4.- Determine the net amount you will receive after deducting the total costs 5.- Calculate the real rate of financial cost (TEA)