question archive Question 6 (3 points) An investor purchased 181500QAR in 365-day T-bills 300 days before maturity to yield 3
Question 6 (3 points) An investor purchased 181500QAR in 365-day T-bills 300 days before maturity to yield 3
Subject:FinancePrice:2.86 Bought7
Question 6 (3 points) An investor purchased 181500QAR in 365-day T-bills 300 days before maturity to yield 3.40%. The investor sold the T-bill 120 days later to yield 3.70%. How much did the investor pay for the T-bill? Answers should be rounded to 2 digits after the decimal point. Your Answer: Answer Add attachments to support your work
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Number of days remaining to maturity = 300 - 120 = 180
Yield = 3.70%
we have to adjust 3.70% for 180 days
180-days Yield (Y) = 3.70% * (180 / 365) = 1.825%
Amount Investor Pays = 181500 / (1+Y)
= 181500 / (1+1.825%)
= 178247.59
(Interest rate of 3.40% is irrelavent)
