4. Yield Spreads (risk premium). 1) What is "flight to quality"? (3 points) 2) Referring to the following figure from Roche Holdings AG case, what had caused the yield spreads widen during the crisis? (5 points) 10.00 9.00 8.00 7.00 Yield () 6.00 5.00 4.00 3.00 Feb-09 2.00 Feb-06 Aug.06 Feb-07 Aug-07 Feb-08 Aug-08 Mergent Corporate Bond Yield Average. Baa Rating Mergent Corporate Bond Yield Average . Aa Rating U.S. Treasures 30-Year Yield Data Source: Datastraan, Margent Blond Record - 3) Among the three types of bond yields See the chart above), which one has the highest yield? Why? (2 points)