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

question 16

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 banker will receive if the exporter discounts the B/A with the importer's bank.

• A)$200,000
• B)$100,000
• C)$25,000
• D)$75,000

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