Assuming a 360-day year, proceeds of $51,748 were received from discounting a $52,536, 90-day note at...

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Assuming a 360-day year, proceeds of $51,748 were received from discounting a $52,536, 90-day note at...

Assuming a 360-day year, proceeds of $51,748 were received from discounting a $52,536, 90-day note at a bank. The discount rate used by the bank in computing the proceeds was

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Answer 1

Answer #1

ANSWER:

Bank discount rate = (Discount from par value / par value) * (360 / days to maturity)

Discount from Par Value =$52536-$51748=$788

Par Value = $52536

Bank discount rate= (788/52536)*(360/90)

= 5.99 Or 6 %

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Answer 2

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