Look at Table 10.1 and Figure 10.7 in the text. When were T-bill rates at their highest over the period from 1926 through 2018? Why do you think they were so high during this period? What relationship underlies your answer?

Table 10.1

Figure 10.7

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U.S. Treasury Large-Company Stocks Long-Term Consumer Year Government Bonds Bills Price Index 1926 11.62% 7.77% 3.27% -1.49% 1927 37.49 8.93 3.12 -2.08 1928 43.61 .10 3.56 -97 1929 -8.42 3.42 4.75 20 1930 -24.90 4.66 2.41 -6.03 1931 -43.34 -5.31 1.07 -9.52 1932 -8.19 16.84 96 -10.30 1933 53.99 -.07 30 51 1934 -1.44 10.03 .16 2.03 1935 47.67 4.98 17 2.99 1936 33.92 7.52 .18 1.21 1937 -35.03 23 31 3.10 1938 31.12 5.53 -02 -2.78 1939 -41 5.94 .02 -48 1940 -9.78 6.09 .00 96 1941 -11.59 .93 .06 9.72 1942 20.34 3.22 27 9.29 1943 25.90 2.08 35 3.16 1944 19.75 2.81 33 2.11 1945 36.44 10.73 33 2.25 1946 -8.07 -.10 35 18.16