Which is bank-discount yield

Assignment Help Financial Management

Reference no: EM131903941

You are looking at a quote for a treasury bill with 245 days to maturity, and observe that the Ask Yield is quoted at 0.08, which is a bank-discount yield.

What is the actual asking price for this bill, if its face value is $10,000?

Recall that the bank-discount yield calculation is:

r = (F-P)/F * (360/n)

Where F is the face value, P is the price, and n is the number of days to maturity.

Reference no: EM131903941

Questions Cloud

Project for the ultimate recreational tennis racket : You are evaluating a project for The Ultimate recreational tennis racket, The tax rate is 30 percent and the required return on the project is 12 percent.

Analysts consider the statement of cash flows : Many sophisticated investors and analysts consider the Statement of Cash Flows to be the most informative of the basic financial statements,

The index to leave index unchanged due to stock split : We must adjust the divisor of the index to leave the index unchanged due to the stock split. What will be the new divisor?

Find the total amount of interest the account earned : Find the total amount needed for Nicole to go to college. Find the total amount of interest the account earned.

Which is bank-discount yield : You are looking at a quote for a treasury bill with 245 days to maturity, which is a bank-discount yield.

What is the firm cost of preferred stock : What is the firm's cost of preferred stock if the tax rate is 33.7 percent and the par value per share is $100?

Your company to evaluate the proposed acquisition : You have been asked by the president of your company to evaluate the proposed acquisition of a new special-purpose truck for $70,000.

Constant growth valuation-what is required rate of return : The dividend is expected to grow at a constant rate of 5% a year. What stock price is expected 1 year from now? What is the required rate of return?

What is after-tax salvage value : Assume a tax rate of 35 percent and a discount rate of 12 percent. If the lathe can be sold for $5,600 at the end of year 3, what is the after-tax salvage value

User Account

All Pages