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4. Assume that interest rates on 15-year non-callable Treasury and corporate bonds with different ratings are as follows: T-bond = 7.72% A = 9.64% AAA
4. Assume that interest rates on 15-year non-callable Treasury and corporate bonds with different ratings are as follows: T-bond = 7.72% A = 9.64% AAA = 8.72% BBB = 10.18% The differences in rates among these issues were most probably caused primarily by: a. Tax effects. b. Default risk differences. c. Maturity risk differences. d. Inflation differences. e. Real risk-free rate differences
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