Assume the first parcel is issued at market yield

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Reference no: EM131085560

A bank agrees to establish a two year Billy facility using 90 day bank bills. the face value of the facility is $10million, and the issuer is charged an acceptance fee of 50 basis points. Determine the net cash flows, from the issuer’s perspective, occurring under the Billy facility over the first 180 days. Assume the first parcel is issued at a market yield of 4.80 percent per annum, the second at 4.65 per cent and the third at 5.00 percent.

Reference no: EM131085560

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