What is the price of a $50,000, 182-day T-bill on its issue date if the market rate of return on this date was 6.875%?
A) $48,342.77
B) $48,262.15
C) $48,285.96
D) $48,148.15
E) $48,320.53

Question

Quizplus · Accepted Answer

The correct answer is A because the price of a T-bill is calculated using the formula: Price = Face Value / (1 + (Market Rate * Days to Maturity / 360)). Plugging in the given values, we get: Price = 50000 / (1 + (0.06875 * 182 / 360)) = 48342.77.

What Is the Price of a $50,000, 182-Day T-Bill on Its