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Data table ( Click on the icon here in order to copy the contents of the data table below into a spreadsheet. ) maturities. a
Data table
Click on the icon here
in order to copy the contents of the data table below
into a spreadsheet. maturities.
a Approximately what real interest rate do Treasury securities offer investors at each maturity?
b If the nominal rate of interest paid by every Treasury security suddenly dropped by without any change in inflationary expectations, what effect, if any, would this have on your answers in part a
c Using your findings in part a select the appropriate yield curve for US Treasury securities Describe the general shape and expectations reflected by the curve.
d What would a follower of the liquidity preference theory say about how the preferences of lenders and borrowers tend to affect the shape of the yield curve in part c
e What would a follower of the market segmentation theory say about the supply and demand for longterm loans versus the supply and demand for shortterm loans given the yield curve in part c
a The real rate of interest on the month US Treasury bill is
Round to one decimal place.
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