Assume the following information is given: $1 million (face value), thirteen-week T-bill futures contract, and the final index price is 95.00. The settlement price for this contract is:
A) $987.361
B) $987,534
C) $1,012,465
D) $1,012,639
E) none of the above

Question

Quizplus · Accepted Answer

The settlement price for a T-bill futures contract is calculated as:Settlement Price = Face Value * (100 - Final Index Price) / 100Settlement Price = $1,000,000 * (100 - 95.00) / 100= $1,000,000 * 0.05= $50,000Therefore, the settlement price for this contract is $987,361 (1,000,000-50,000).

Assume the Following Information Is Given: $1 Million (Face Value)