Question: why is the Answer A ? 41. You purchase a CD in the secondary market with 45 days to maturity at a rate of 2.95%.

why is the Answer A ?

41. You purchase a CD in the secondary market with 45 days to maturity at a rate of 2.95%. This CD was originally with a tenor of 1 year at a par rate of 3.25%. The face value of the CD was GBP 25,000,000. If you hold this CD until maturity, what will be your holding period retum? a. 2.95% b. 2.96% c. 3.04% d. 3.25%

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