A 182-day, $250,000 Treasury Bill originally issued at 6.6% was sold at 5.9% simple interest, 82 days after it was issued. What was the selling price?
A) $245,560
B) $250,000
C) $246,730
D) $246,347
E) $246,023

Question

Quizplus · Accepted Answer

The selling price of the Treasury Bill can be calculated by first determining the discount at the original issue and then calculating the value of the bill at the time of sale. 1. Original discount = (6.6% of $250,000) * (182/360) = $8,4552. Original price = $250,000 - $8,455 = $241,5453. Interest earned in 82 days at 5.9% = ($250,000 * 5.9% * 82/360) = $4,478.334. Selling price = Original price + Interest earned = $241,545 + $4,478.33 = $246,023.33Rounded to the nearest dollar, the selling price is $246,023.

A 182-Day, $250,000 Treasury Bill Originally Issued at 6