A Treasury Bill with a Par Value of $100,000 Due

question 5

Multiple Choice

A Treasury bill with a par value of $100,000 due one month from now is selling today for $99,010.The effective annual yield is __________.

• A) 12.40%
• B) 12.55%
• C) 12.62%
• D) 12.68%
• E) none of these

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Definitions:

Self-Control Problems

Issues related to an individual's difficulty in exercising restraint or choosing long-term benefits over short-term gratification.

Dictators/Proposers

Individuals who make unilateral decisions or offers in the context of economic models or experiments.

Dictator Game

An experimental game in behavioural economics where one player, the "dictator," determines how to split a reward between themselves and another player.

Ultimatum Game

A game in experimental economics where two players decide on how to divide a sum of money; one proposes a split, and the other player can accept or reject.