Calculate the simple rate of return on a $1,000,000 181-day Treasury Bill that was issued for $970,639.
A) 6.1%
B) 5.9%
C) 4.9%
D) 5.5%
E) 7.7%

Name: Calculate the simple rate of return on a $1,000,000 181-day Treasury Bill that was issued for $970,639. A) 6.1% B) 5.9% C) 4.9% D) 5.5% E) 7.7%
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Quizplus · Accepted Answer

The simple rate of return is calculated as [(Face Value - Purchase Price) / Purchase Price] * (365 / Days to Maturity). For this T-bill: [(1,000,000 - 970,639) / 970,639] * (365 / 181) = 6.1%.

Calculate the Simple Rate of Return on a $1,000,000 181-Day