4. At one point in the late 1970s, the interest rate on one-year U.S. Treasury bills was 12 percent, while the interest rate on one- year debt issued by the Swiss government was only 3 percent.

(a) . Use supply and demand curves to il¬ lustrate the equilibrium in the U.S. and Swiss markets for one-year government loans.

(b) . What could account for the differ¬ ences in these interest rates?