Question 19. 19. At the (whatever date) auction, three month Treasury bills were

Question

Question 19.19. At the (whatever date) auction, three month Treasury bills were sold at a price
of $99.540 per $100. The discount yield on these bills was: (Assume that date
was not a leap year, and select nearest answer) (Points : 3)        1.854 %
       2.110 %
       2.163 %
       2.224 % Question 20.20. At the (whatever date) auction, three month Treasury bills sold at a price of
$9,948.88 per $10,000. The actual return (investment yield) on those bills was:
(Assume that date was a leap year, and select nearest answer) (Points : 3)        1.882%
       2.067%
       2.349%
       3.491% Question 19.19. At the (whatever date) auction, three month Treasury bills were sold at a price
of $99.540 per $100. The discount yield on these bills was: (Assume that date
was not a leap year, and select nearest answer) (Points : 3)        1.854 %
       2.110 %
       2.163 %
       2.224 %

Explanation / Answer

Question 19.   

Discount amount=(100-99.540)=$0.46

Discount yield=(Discount/Par value)*(360/days to mature)

Discount yield=(0.46/100)*(360/91)

Discount yield=0.0046*(360/90)=0.0184=1.84%

Nearest Answer=1.845%

Question 20

Discount amount=(10000-9948.88)=$51.12

Discount yield=(51.12/10000)*(360/90)=0.020448=2.0448%

Nearest answer=2.067%

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