What is the present value of a 3 month T-Bill?
Hi everyone. I've been given the following information on a 91 day treasury bill and need to convert it from book value to market value.
Maturity = 91 days
Annual Interest = 0.75%
Book Value = $150 million
No payment because it is a zero-coupon bond.
I used the financial calculator and got a present value of $149,720,061 using N=1/4, I/Y=0.75, FV=150M, PMT=0. I'm not sure if this is right, however, as I think that the interest rate needs to be multiplied by 4.
Any thoughts? Thanks in advance!
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