Question

2. A U.S. Treasury bill with 140 days to maturity is quoted at a discount yield of 1.07 percent. What is the bond equivalent yield?

Answer #1

Hello Student,

we have provide with maturity (t) = 140 days and Discount yield (DY) = 1.07%

The relationship between bond equivalent yeild (BEY) and discount yield (DY) can be stated as follows:

BEY = (365 * DY)/ [360- (t*DY)]

Put the available values- (DY in decimal form)

= (365*1.07)/ [360 - (140*0.0107)]

= 3.9055 / (360- 1.498)

= 0.0109 (rounded to 4 decimal places)

Therefore, Bond equivalent yield = 1.09%

Feel free to post your queries in comment box.

have a good day :)

A U.S. Treasury bill with 64 days to maturity is quoted at a
discount yield of 1.75 percent. Assume a $1 million face value.
What is the bond equivalent yield? (Do not round
intermediate calculations. Enter your answer as a percent rounded
to 3 decimal places.)
Bond equivalent yield
%

A U.S. Treasury Bill with 92 days to maturity is quoted at a
discount yield of 2.37%.
a) Assuming a $100,000 face value, what dollar price
would you pay for this bill?
b) What holding period yield will you earn?
c) What is the effective annual yield?
d) What is the bond equivalent yield?

Treasury bill purchased in December 2016 has 140 days until
maturity and a bank discount yield of 1.87 percent. Assume a $100
face value.
a. What is the price of the bill as a
percentage of face value? (Do not round intermediate
calculations. Round your answer to 3 decimal places.)
b. What is the bond equivalent yield?
(Do not round intermediate calculations. Enter your answer
as a percent rounded to 3 decimal places.)

What is the price of a U.S. Treasury bill with 87 days to
maturity quoted at a discount yield of 2.15 percent? Assume a $1
million face value. (Enter your answer in dollars not in millions.
Do not round intermediate calculations. Round your answer to 2
decimal places.)

2. What is the difference between a discount yield and a bond
equivalent yield? Which yield is used for Treasury bill quotes?
11. What is the difference between a repurchase agreement and a
reverse repurchase agreement?
18. Who are the major issuers of and investors in money market
securities?
7. You can purchase a T-bill that is 95 days from maturity for
$9,965. The T-bill has a face value of $10,000.
Calculate the T-bill’s quoted yield.
Calculate the T-bill’s bond...

1. A 270-day Treasury bill (assume a $1000 par value) is quoted
as having a price of $978.62. What is its bond equivalent yield?
Record your final numerical answers as a percent rounded to 3
decimal places.
2. A 180-day Treasury bill is quoted as having a 3.875% bond
equivalent yield. What is the effective annual yield? Record your
final numerical answers as a percent rounded to 3 decimal
places.

A T-bill that is 240 days from maturity is selling for $95,940.
The T-bill has a face value of $100,000. a. Calculate the discount
yield, bond equivalent yield, and EAR on the T-bill. b. Calculate
the discount yield, bond equivalent yield, and EAR on the T-bill if
it matures in 315 days.
Calculate the discount yield, bond equivalent yield, and EAR on
the T-bill. (Use 360 days for discount yield and 365 days in a year
for bond equivalent yield...

The current T-Bill that is 225 days from maturity is selling for
$98,850. The T. Bill has a face value of $100,000
1. Calculate the Discount Yield on the T-Bill.
2. Calculate the Bond Equivalent Yield on the T-Bill
3. Calculate the EAR on the T-Bill
In the above problem all else remaining the same, what would be
the Bond Equivalent Yield on the T-Bill if the maturity is 300
days?

1-
What is the discount yield, bond equivalent yield, and effective
annual return on a $1 million T-bill that currently sells at 96.375
percent of its face value and is 75 days from maturity?
(Use 360 days for discount yield and 365 days in a year for
bond equivalent yield and effective annual return. Do not round
intermediate calculations. Round your answers to 3 decimal
places. (e.g., 32.161))
Discount
yield
%
Bond
equivalent yield
%
Effective annual return
%...

A U.S. Treasury Bill and Government of Canada Treasury Bill have
the same maturity value of $10,000, same term of 90 days, and same
price of $9,873.64. Find the difference between the quoted rates of
these two T-bills. Please show work with formulas. No Excel.

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 46 minutes ago

asked 46 minutes ago

asked 57 minutes ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 2 hours ago

asked 2 hours ago

asked 2 hours ago

asked 3 hours ago

asked 3 hours ago