In the global financial crisis box in section 6.2, bloomberg reported that the three-month treasury bill sold for a price of $

Question

2 years ago

7

100.002556 per $100 face value. what is the yield to maturity of this bond, expressed as an ear?

1 answer:

iris [78.8K] · Answer 1 · 2023-08-10T04:10:16+03:00

Based on the price the three-month treasury bill was sold at, and the face value, the yield to maturity as an EAR would be -0.010223%.

<h3>What is the yield to maturity as an EAR?</h3>

First find the 3 month yield to maturity:

= Face value / Sale value

= 100 / 100.002556

= -0.002556%

Expressed as an EAR, this is:

= (1 - 0.002556/100.002556)⁴ - 1

= -0.010223%

The Annual yield to maturity would be:

= -0.002556% x 3 / 12 monts

= -0.010224%

Find out more on EAR at brainly.com/question/6623488.

In the global financial crisis box in section​ 6.2, bloomberg reported that the​ three-month treasury bill sold for a price of $