Assume the Time from Acceptance to Maturity on a $10,000,000

question 78

Multiple Choice

Assume the time from acceptance to maturity on a $10,000,000 banker's acceptance is 90 days.Further assume that the importing bank's acceptance commission is 1 percent and that the market rate for 90-day B/As is 3.0 percent.Calculate the amount the exporter will receive if he discounts the B/A with the importer's bank.

• A)$9,993,750
• B)$9,900,000
• C)$9,975,000
• D)$9,009,375