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Suppose you pay $9,400 for a $10,000 par Treasury bill maturing in 6 months. What is the effective annual rate of return for this investment

Sagot :

abiolataiwo2015

Answer:

C. 13.17%

Explanation:

Calculation to determine the effective annual rate of return for this investment

Effective annual rate of return=[10,000/9400]^(12/6)-1

Effective annual rate of return= 13.17%

Therefore the effective annual rate of return for this investment is 13.17%

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