interest problem

Question

Paul purchased $16,000 worth of 52-week treasury bills for $15,750. What is the rate of return on his investment?

For this purpose only (not for your work or the exam), round to the nearest integer. Do not put the unit.

Answer 1

The rate of return is the maturity value divided by the purchase price.

 

16000/15750 = 1.015873

 

Then subtract 1 and multiply by 100

1.587%