Question: [10 points] The Treasury plans to issue $10 billion of 2-year bond. It received the following competitive and noncompetitive bids: Bidder Yield Quantity ($ billion)
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[10 points] The Treasury plans to issue $10 billion of 2-year bond. It received the following competitive and noncompetitive bids: Bidder Yield Quantity ($ billion) Allocation ($ billion) 1 2.10% 2 2 2.15% 3 3 2.30% 2 2.30% 2 5 2.45% 2 2.50% 1 7 Non-Competitive 2 (a) [6 points) If the Treasury uses a uniform auction, what will be the stop-out yield? What will be the allocation to each bidder? Fill in the allocation amount in the table above. (b) [4 points] What will be the coupon rate of the 2-year bond
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