A Treasury bill (T-bill) with 38 days until maturity has a bank discount yield of 3.82 percent. Which of the following is closestto the money market yield on the T-bill?（ ）
The formula for the money market yield is: [360× bank discount yield]/[360-(t× bank discount yield)]. Therefore, the money market yield is: [360×0.0382]/[360-(38×0.0382)]=0.0384, or 3.84%.
Alternatively: Actual discount=3.82%×(38/360)=0.4032%.
T-Bill price=100-0.4032=99.5968%.
HPR=(100/99.5968)-1=0.4048%.
MMY=0.4048%×(360/38)=3.835%.