Answer:
Underestimation of my earnings is 0.0361%
Explanation:
T bill is the short-term debt obligation which is backed by the government usually with a maturity of one year or less. It has low risk as it is backed by the governments.
Undereastimation of the earnings can be calculated as follow
Underestimation = [tex]\frac{Buying value - Maturity Value }{Buying value}[/tex] x [tex]\frac{365}{days to maturity}[/tex]
Underestimation = [tex]\frac{5000 - 4999.55}{5000}[/tex] x [tex]\frac{365}{91}[/tex]
Underestimation = [tex]\frac{0.45}{5000}[/tex] x [tex]\frac{365}{91}[/tex]
Underestimation = 0.000361
Underestimation = 0.0361%
