Issue No. xxxx of T-Bills is available for sale at a discount of 6.22%. The face value of the bills is 75,000,000 and they mature in 90 days. What is the approximate price at which they would be sold?

Issue No. xxxx of T-Bills is available for sale at a discount of 6.22%. The face value of the bills is 75,000,000 and they mature in 90 days. What is the approximate price at which they would be sold?

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter6: Fixed-income Securities: Characteristics And Valuation

Section: Chapter Questions

Problem 21P

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Concept explainers

Treasury Market

On-the-run securities are the most recently issued securities in the market depth and are therefore traded at some premium. The off-the-run securities are the ones issued just before the most recent ones. The on-the-run securities have a lower yield to the investor than the off-the-run securities.

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Give typing answer with explanation and conclusion

a) Issue No. xxxx of T-Bills is available for sale at a discount of 6.22%. The face value of the bills is
75,000,000 and they mature in 90 days. What is the approximate price at which they would be
sold?

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