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Homework Help: Economics - Rate of return & Yield Rate

  1. Jul 28, 2012 #1
    You are considering purchasing a 274 day treasury bill that has a maturity value of 100000, The yield rate of interest on the 274 day treasury bills is 5.48%.

    Suppose you paid 96050 for a 274 day treasury bill with a 100000 maturity value and you sold it 150 days later for 98190.81. Calculate the rate of return you received on the treasury bill and find the yield rate of interest the buyer will receive on the treasury bill.


    0 = -96050 + 98190.81(1+i)^(-150)
    solve for i

    I got this as my rate of return, however I am confused as to what the yield rate of interest is?
  2. jcsd
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