The time from acceptance to maturity on a 30000000 bankers a

The time from acceptance to maturity on a $30,000,000 banker\'s acceptance is 45 days. The importing bank\'s acceptance commission is 1.5 percent and that the market rate for 45-day B/As is 4½ percent.

Determine the amount the exporter will receive if he discounts the B/A with the importer\'s bank.

Solution

Answer )

If the exporter discounts the B/A with the importer bank he will recieve:

$30,000,000 * (( 1- (0.015+0.045) * 45/360) = $ 29775000