You just finished your third year as a Managing Director in an Investment Bank, and just received
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Question:
You just finished your third year as a Managing Director in an Investment Bank, and just received your bonus and now have excess cash to invest for the next 60 days while awaiting delivery of your new Patek Philippe Nautilus.
You first consider T-Bills and see the following in the newspaper:
Mat. Bid Ask
January 15'18 60 6% 5%
You are also interested in the Certificate of Deposit Market. You can purchase a $100,000 CD that matures in 60 days with an interest rate of 6.07%. The current market interest rate is 5.5%. Another option is to lend $100,000 for 60 days in the Repo market where the interest rate is 6%.
What is the security do you mark?
Related Book For
Intermediate Accounting
ISBN: 978-0077400163
6th edition
Authors: J. David Spiceland, James Sepe, Mark Nelson
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