Yield Calculation T Bill Discount & Negotiable Certificate of Deposit Worksheet
Can you help me understand this Marketing question?
- Assume an investor purchased a six-month T-bill with a $10,000 par value for $9,840 and sold it ninety days later for $9,900. What is the yield?
- Newly issued three-month T-bills with a par value of $10,000 sold for $9,840. Compute the T-bill discount.
- Assume an investor purchased six-month commercial paper with a face value of $1,000,000 for $985,000. What is the yield?
- Titleist Corporation arranged a repurchase agreement in which it purchased securities for $2,650,000 and will sell the securities back for $2,680,000 in 72 days. What is the yield (or repo rate) to Titleist Corporation?
- Bridgestone purchased a negotiable certificate of Deposit (NCD) a year ago in the secondary market for $994,000. The NCD matures today at a price of $1,000,000, and Phil received $26,000 in interest. What is Bridgestone’s return on the NCD?