Gen Combo Looseleaf Principles Of Corporate Finance With Connect Access Card
13th Edition
ISBN: 9781260695991
Author: Richard A Brealey
Publisher: McGraw-Hill Education
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Chapter 30, Problem 27PS
Summary Introduction
To determine: Annual yield.
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In October 2008, six-month (182-day) Treasury bills were issued at a discount of 1.42%. What was the annual yield? Assume 365 days in a year. (Do not round intermediate calculations. Enter your answer as a percent rounded to 3 decimal places.)
In January 2020, three-month (91 - day) Treasury bills were selling at a discount of 1.48 %. What was the annual yield? Assume 365 days in a year. Note: Do not round intermediate calculations.
Enter your answer as a percent rounded to 2 decimal places.
A 3 month $19,000 treasury bill with a simple annual discount rate of 0.27% was sold in 2016. Assume 365 days in a year
a) the price of the T bill was ?
b) the actual interest rate paid by the treasury is ?
Chapter 30 Solutions
Gen Combo Looseleaf Principles Of Corporate Finance With Connect Access Card
Ch. 30 - Prob. 1PSCh. 30 - Components of working capital True or false? a....Ch. 30 - Inventory True or false? a. Just-in-time inventory...Ch. 30 - Inventory What are the trade-offs involved in the...Ch. 30 - Prob. 5PSCh. 30 - Prob. 6PSCh. 30 - Prob. 7PSCh. 30 - Prob. 8PSCh. 30 - Prob. 9PSCh. 30 - Credit terms Phoenix Lambert currently sells its...
Ch. 30 - Prob. 11PSCh. 30 - Prob. 12PSCh. 30 - Prob. 13PSCh. 30 - Prob. 14PSCh. 30 - Prob. 15PSCh. 30 - Credit policy How should your willingness to grant...Ch. 30 - Prob. 17PSCh. 30 - Prob. 18PSCh. 30 - Prob. 19PSCh. 30 - Prob. 20PSCh. 30 - Cash management Complete the passage that follows...Ch. 30 - Prob. 22PSCh. 30 - Prob. 23PSCh. 30 - Prob. 24PSCh. 30 - Prob. 25PSCh. 30 - Prob. 26PSCh. 30 - Prob. 27PSCh. 30 - Prob. 28PSCh. 30 - Prob. 29PSCh. 30 - Prob. 30PSCh. 30 - Prob. 31PSCh. 30 - Prob. 32PSCh. 30 - Prob. 34PSCh. 30 - Prob. 35PSCh. 30 - Prob. 36PSCh. 30 - After-tax yields Suppose you are a wealthy...Ch. 30 - Prob. 38PSCh. 30 - Prob. 39PS
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- Historically, Treasury bills offered higher rates. On January 2, 2007, the discount rates were substantially higher than in July 2016. For the following Treasury bill bought in 2007, find (a) the price of the Treasury bill (T-bill), and (b) the actual interest rate paid by the Treasury. Assume 365 days in a year. Three-month $15,000 T-bill with a simple annual discount rate of of 3.12% (a) The price of the T-bill was $ (Round to the nearest cent as needed.) (b) The actual interest rate paid by the Treasury is%. (Type an integer or decimal rounded to four decimal places as needed.)arrow_forwardFor the following treasury bill bought in 2007, find (a) the price of the T-bill, and (b) the actual interest rate paid by the Treasury. Nine-month $23,500 T-bill with discount rate of 5.53% (a) The price of the T-bill is $ (Round to the nearest dollar as needed.)arrow_forwardHistorically, Treasury bills offered higher rates. On January 2, 2007, the discount rates were substantially higher than in July 2016. For the following Treasury bill bought in 2007, find (a) the price of the Treasury bill (T-bill), and (b) the actual interest rate paid by the Treasury. Assume 365 days in a year. Three-month $24,000 T-bill with a simple annual discount rate of of 3.96% My Solutio (a) The price of the T-bill was S. (Round to the nearest cent as needed.) (b) The actual interest rate paid by the Treasury is %. (Type an integer or decimal rounded to four decimal places as needed.) ert My le thio quoloarrow_forward
- Consider the following table for a seven-year period: Year 1 2 3 4 5 6 7 U.S. Treasury Bills 3.90% Returns 3.75 4.65 5.07 2.87 1.75 1.48 Inflation -1.24% -2.38 -1.28 0.70 -6.52 -9.44 -1.39 What was the average real return for Treasury bills for this time period? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.arrow_forwardHistorically, Treasury bills offered higher rates. On January 2, 2007, the discount rates were substantially higher than in July 2016. For the following Treasury bill bought in 2007, find (a) the pric the Treasury bill (T-bill), and (b) the actual interest rate paid by the Treasury. Assume 365 days in a year. Six-month $17,500 T-bill with simple annual discount rate of 5.98% (a) The price of the T-bill was $ (Round to the nearest cent as needed.) (b) The actual interest rate paid by the Treasury is (Type an integer or decimal rounded to four decimal places as needed.)arrow_forwardOn January 18, 2007, BusinessWeek reported yields on Treasury Bills. Bruce Martin purchased a $10,000 13 weekTreasury bill at $9,881.25. a) What is the interest amount? b) What is the effective rate of interest? (to the nearest hundredth of a percent)arrow_forward
- A 6-month $17,500 treasury bill with a simple annual discount rate of 0.48% was sold in 2016. Assume 365 days in a year. (a) Find the price of the treasury bill (T-bill). (b) Find the actual interest rate paid by the Treasury. (a) The price of the T-bill was $ (Round to the nearest cent as needed.) (b) The actual interest rate paid by the Treasury is %. (Type an integer or decimal rounded to four decimal places as needed.)arrow_forwardFor the following treasury bill bought in 2007, find (a) the price of the T-bill, and (b) the actual interest rate paid by the Treasury. Three-month $16,000 T-bill with discount rate of 3.89% (a) The price of the T-bill is $ (Round to the nearest dollar as needed.)arrow_forwardSuppose we have the following Treasury bill returns and inflation rates over an eight- year period: Year Treasury Bills 1 2 3 4 5 6 7 8 7.37% 8.07 5.95 Treasury bills Inflation 5.15 5.53 7.72 10.64 12.18 Inflation 8.79% 12.42 7.02 4.94 6.78 9.10 13.37 12.60 a. Calculate the arithmetic average return for Treasury bills and the average annual inflation rate (consumer price index) for this period. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) Average return % %arrow_forward
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