Question: please show what to type in excel green boxes! 20 Probiem 2a. (15 points): What would be the underestimation of your carnings as an imvetor
20 Probiem 2a. (15 points): What would be the underestimation of your carnings as an imvetor If you use the dicount rate instead of the investment rate to measure the return on your investment if vou buy a \$5, 000 r-bill that matures in 91 days for $4,99955 ? Solution: Face value of the T-bill = Moturity = Price for the T-bill - Annulived diccourt rate = Annulated investment rate = Difference between arvuliced docount fate and investment rate : Therefore, if you use the discount rate, you would underestimate your return by: Solvtion: rece value of the T-bill = Maturity = Price foc the T-bill= Discount fate = Inestment ilate *
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
