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A three-month t bill sold for a price of $99.311998 per $100 face value. What is...

  1. 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%

Solutions

Expert Solution

answer : b : 2.8%

jeff jeffy answered 1 year ago
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