Calculate the bank discount yield on bill

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Reference no: EM133075033

Question 1: a. Which security offers a higher effective annual yield?

i. A three-month bill selling at $9,764

ii. A six-month bill selling at $9,539

b. Calculate the bank discount yield on each bill.

Question 2: Find the price of a 6-month (180-day) U.S. T-bill with apar value of $100,000 and a bank discount yield of 9.18%

Question 3: You are bearish on BCE stock and decide to sell short100 shares at the current market price of $50 per share.

a. How much in cash or securities must you put into your brokerage account if the broker's initial margin requirement is 50% of the value of the short position.

b) How high can the price of the stock go before you get a margin call if the minimum margin is 30% of the value of the short position?

Reference no: EM133075033

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