In: Finance
A three-month t bill sold for a price of $99.311998 per $100 face value. What is the yield to maturity of this bond expressed as an Effective Annual Rate (as opposed to the Nominal Rate Rate)? Remember, the bond matures in 3 months, meaning C/Y = 4. First compute nominal rate and then figure out effective rate. Ok to solve with Excel
a |
2.5% |
|
b |
2.8% |
|
c |
3.2% |
|
d |
4.0% |