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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:6 X6 C% j8 q8 z! e* U+ G2 ]
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A. 3.13%.
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: e5 C5 h+ {1 ?5 o/ G3 X; J+ y* |, WB. 4.12%.( X5 A& H) V: X0 F
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C. 4.18%.
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