Suppose you pay $9,700 for a $10,000 par Treasury bill maturing in 3 months. What is the holding-period return for this investment?

A) 3.01%
B) 3.09%
C) 12.42%
D) 16.71%

Holding-Period Return

The total return received from holding an asset or portfolio of assets over a specified period, including interest, dividends, and capital gains.

Treasury Bill

Short-term government securities issued at a discount from the face value and maturing at par, used to finance government spending.

Par

Par refers to the face value of a bond or stock, which is the amount originally paid for it and the amount that will be repaid at maturity.