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Q: The bond equivalent yield on a T-bill matures in 45 days, priced at $99.00 with...

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Finance

Q: The bond equivalent yield on a T-bill matures in 45 days,priced at $99.00 with a $100 face value, is ____:

A: BEY = 1.01% * 8.111 = 8.19%

Above is the question and the solution but, I am confused abouthow they came to this solution. I'm not sure where the 1.01% or8.111 came from?? Any help would be appreciated!

Answer & Explanation Solved by verified expert
3.6 Ratings (348 Votes)
In the question it is provided that bond equivalent yield is missing Bond Equivalent implies that coupon rateinterest rate is equal to the Yield Rate Yield to maturity can be calculated by using the following formula    See Answer
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