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A company is investigating the purchase of a banker’s acceptance (BA). The $1,000,000 face value BA has 150 days to maturity and is quoted at 4.05 percent on a discount-basis yield. If the company’s marginal tax rate is 25 percent, then the money market yield on the BA is closest to: C o9 | X" ^# q/ v8 C# ?
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A. 3.13%.
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1 ?% H! V! R/ z; M; k3 e1 EB. 4.12%.5 f3 f9 n; z- U) q
3 O. d' u/ P/ h2 e7 [' l* rC. 4.18%.
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