a. "Empirical evidence suggests that with respect to bond risk premiums that influ- ence the shape of the Treasury yield curve, there is a linear relationship between Treasury average returns and duration." Explain whether you agree or disagree with this statement. If you dis- agree, explain the type of relationship that has been observed.

b. What is meant by the "convexity bias" influence on the shape of the Treasury yield curve?

AppendixLO1