A bank plans on borrowing $150 million through an RP transaction collateralized by T-bills. It plans...
A bank plans on borrowing $150 million through an RP transaction collateralized by T-bills. It plans on borrowing the money for 5 days and the current RP rate is 5.15 percent. What is the bank's total interest cost in dollars?
Homework Answers
Total interest cost = Amount of borrowing * Rate * Number of days/ Total number of days
= 150000000*5.15%* 5/365=
| $105,821.92 |
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