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3. Which one of the following statements is correct? A. Treasury bill returns tend to vary in direct relation to inflation rates. B. Short-term interest

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3. Which one of the following statements is correct? A. Treasury bill returns tend to vary in direct relation to inflation rates. B. Short-term interest rates are affected by future inflation expectations. C. All real interest rates will be positive as long as the inflation rate is positive. D. The Fisher hypothesis advocates that real interest rates follow inflation rates. 4. What type of yield is the asked yield on a Treasury bill? A. Bid-ask yield B. Discount yield C. Zero coupon yield D. Bond equivalent yield

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