Calculate the discount yield and bond equivalent yield

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Reference no: EM132020098

A T-bill that is 215 days from maturity is selling for $95,890. The T-bill has a face value of $100,000.

a. Calculate the discount yield, bond equivalent yield, and EAR on the T-bill. (Use 360 days for discount yield and 365 days in a year for bond equivalent yield and effective annual return. Do not round intermediate calculations. Round your answers to 2 decimal places. (e.g., 32.16))

Discount yield %
Bond equivalent yield %
EAR %

b. Calculate the discount yield, bond equivalent yield, and EAR on the T-bill if it matures in 290 days. (Use 360 days for discount yield and 365 days in a year for bond equivalent yield and effective annual return. Do not round intermediate calculations. Round your answers to 2 decimal places.(e.g., 32.16))

Discount yield %
Bond equivalent yield %
EAR %

Reference no: EM132020098

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