2. Figure 1 in the chapter shows the estimated real and nominal rates for three-month Treasury bills.

GO to http://www.martincapital.eom/charts.

htm. Click on "interest rates and yields" then on

"Nominal versus Real Market Rates."

a. Compare the three-month real rate to the long-

term real rate. Which is greater?

b. Compare the short-term nominal rate to the long-term nominal rate. Which appears most volatile?