How would each of the following likely affect the spread (increase, decrease, or no effect) between 10-year treasury securities and moderately risky corporate bonds? Explain briefly.
a. A financial crisis develops.
b. A financial crisis ends.
c. The Fed or the Treasury guarantees all payments promised to holders of moderately risky corporate bonds.
d. Due to a rise in oil prices, there is an increased chance of a moderately risky corporation going bankrupt.
e. The government—to fund large budget deficits— offers huge amounts of additional new 10-year treasury securities for sale to the public.