If the 175 days T-bill have the maturity of one year with the value of $8000 and face value is $10000 then reported discount yield is _____________?
Correct answer: B. 0.4114
- A. 0.525
- B. 0.4114
- C. 0.4214
- D. 0.4514
Explanation
The discount yield is calculated as (10,000 − 8,000) ÷ 10,000 × 360 ÷ 175 = 0.4114, or about 41.14%. Therefore, option b matches the money-market discount-yield formula.
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