Briefly describe the relationship between the three rates

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An investor purchases commercial paper which matures in 160 days and has a face value of $1 million. The price at purchase is $991,740.03. Thirty days later, the investor sells the commercial paper for $994,685.93. Calculate the discount yield at the time of purchase, the discount yield at the time of sale, and the investor's annualized realized return. Briefly describe the relationship between the three rates.

Reference no: EM13669008

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