Angela made an 180-day investment arrangement involving two consecutive 90 day $100,000 bank bills. The maturity proceeds of the first bill will be used to purchase the second bank bill. The remain surplus cash after 90 days will be invested at 2.071% p.a. simple interest rate. The yield rate of first bank bill is 2.443% p.a. simple interest rate and the yield rate of second bank bill is 2.671% p.a. simple interest rate. a) What is price of first bank bill? Round your answer to three decimal places. a. 99401.223 b. 99345.706 c. 99397.616 d. 99491.937

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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H4

Angela made an 180-day investment
arrangement involving two consecutive 90 day
$100,000 bank bills. The maturity proceeds of
the first bill will be used to purchase the second
bank bill. The remain surplus cash after 90 days
will be invested at 2.071% p.a. simple interest
rate. The yield rate of first bank bill is 2.443%
p.a. simple interest rate and the yield rate of
second bank bill is 2.671% p.a. simple interest
rate.
a) What is price of first bank bill? Round your
answer to three decimal places.
a. 99401.223
O b. 99345.706
O c. 99397.616
d. 99491.937
Transcribed Image Text:Angela made an 180-day investment arrangement involving two consecutive 90 day $100,000 bank bills. The maturity proceeds of the first bill will be used to purchase the second bank bill. The remain surplus cash after 90 days will be invested at 2.071% p.a. simple interest rate. The yield rate of first bank bill is 2.443% p.a. simple interest rate and the yield rate of second bank bill is 2.671% p.a. simple interest rate. a) What is price of first bank bill? Round your answer to three decimal places. a. 99401.223 O b. 99345.706 O c. 99397.616 d. 99491.937
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