QuestionJune 5, 2025

XYZ Corporation invests 7,000 into 91-da y treasury bills with an interest rate of 2.5% . If the broker charges a 25 commission , what is the yield? yield=[?]% yield=(amount invested (interest rate)(frac (days invested)/(360days)))(amount invested(frac {daysinvested){ Give your answer as a percent rounded to the nearest hundredth.

XYZ Corporation invests 7,000 into 91-da y treasury bills with an interest rate of 2.5% . If the broker charges a 25 commission , what is the yield? yield=[?]% yield=(amount invested (interest rate)(frac (days invested)/(360days)))(amount invested(frac {daysinvested){ Give your answer as a percent rounded to the nearest hundredth.
XYZ Corporation invests 7,000 into
91-da y treasury bills with an interest
rate of 2.5%  . If the broker charges a
 25 commission , what is the yield?
yield=[?]% 
yield=(amount invested (interest rate)(frac (days invested)/(360days)))(amount invested(frac {daysinvested){
Give your answer as a percent rounded to the nearest hundredth.

Solution
4.1(182 votes)

Answer

2.18\% Explanation 1. Calculate Interest Earned Use the formula for interest: \text{Interest} = \text{Principal} \times \text{Rate} \times \frac{\text{Days}}{360} . Here, \text{Principal} = 7000, \text{Rate} = 0.025, and \text{Days} = 91. So, \text{Interest} = 7000 \times 0.025 \times \frac{91}{360}. 2. Calculate Total Earnings Add the commission to the principal: \text{Total Earnings} = \text{Principal} + \text{Interest} - \text{Commission}. Commission is \25, so \text{Total Earnings} = 7000 + \text{Interest} - 25. 3. Calculate Yield Use the yield formula: \text{Yield} = \frac{\text{Interest}}{\text{Principal} - \text{Commission}} \times 100\%. Substitute the values from previous steps.

Explanation

1. Calculate Interest Earned<br /> Use the formula for interest: $ \text{Interest} = \text{Principal} \times \text{Rate} \times \frac{\text{Days}}{360} $. Here, $\text{Principal} = 7000$, $\text{Rate} = 0.025$, and $\text{Days} = 91$. So, $\text{Interest} = 7000 \times 0.025 \times \frac{91}{360}$.<br /><br />2. Calculate Total Earnings<br /> Add the commission to the principal: $\text{Total Earnings} = \text{Principal} + \text{Interest} - \text{Commission}$. Commission is \$25, so $\text{Total Earnings} = 7000 + \text{Interest} - 25$.<br /><br />3. Calculate Yield<br /> Use the yield formula: $\text{Yield} = \frac{\text{Interest}}{\text{Principal} - \text{Commission}} \times 100\%$. Substitute the values from previous steps.
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