ch07 - donde consegui una de ellas midterm

# ch07 - donde consegui una de ellas midterm -...

This preview shows pages 1–2. Sign up to view the full content.

Chapter 7:  ANSWERS TO "DO YOU UNDERSTAND" TEXT QUESTIONS DO YOU UNDERSTAND?  1.  Given the economic role of the money market, explain the importance of the  typical characteristics of money market securities. Solution:  Money market securities are liquid, short-term, high quality debt  securities issued by high quality borrowers and are used to store liquidity by  investors around the world. 2.  Using the information in Exhibit 7.4, calculate the  price  of a 13-week T-bill and  express it as a percentage of face value. Solution:  At the 1.75% awarded competitive bidders, the price(% of face) of a 13- week  T-bill on a discount basis is  [ ] f d f xP n x y p P 360 0 - =   =  55764 . 99 ) 100 )( 360 91 )( 0175 (. 100 = - 3.  Refer to Exhibit 7.6.  On March 28, 2002, what is the price of the T-bill maturing  on June 6, 2002?  Calculate the price two ways, using both the asked yield and  the bid yield. Assume a face value of \$10,000.

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

### What students are saying

• As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

Kiran Temple University Fox School of Business ‘17, Course Hero Intern

• I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

Dana University of Pennsylvania ‘17, Course Hero Intern

• The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

Jill Tulane University ‘16, Course Hero Intern