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Unformatted text preview: Discount on sale is the difference between the face value of the security and the price it is sold at auction. Simple yield is found by dividing the discount (the dollar return to the investor on maturity) by the price paid on purchase. Annualized yield is found by compounding the simple yield by the number of periods per year. In this case a 3-month T-Bill is assumed to have a 90 day maturity within a 360 day interest rate year (U.S. dollar practices)....
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This note was uploaded on 07/10/2011 for the course BUS 464 taught by Professor Pham during the Spring '11 term at Humboldt State University.
- Spring '11