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Inflation is expected to increase steadily over the next 10 years, there is a positive maturity risk premium on both Treasury and corporate bonds, and

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Inflation is expected to increase steadily over the next 10 years, there is a positive maturity risk premium on both Treasury and corporate bonds, and the real risk-free rate of interest is expected to remain constant. Which of the following statements is CORRECT? O a. The yield on 7-year corporate bonds must exceed the yield on 10 year Treasury bonds. b. The stated conditions cannot all be true-they are internally inconsistent O c The Treasury yield curve under the stated conditions would be humped rather than have a consistent positive or negative slope. d. The yield on any corporate bond must exceed the yields on all Treasury bonds. e. The yield on 10-year Treasury securities must exceed the yield on 7-year Treasury securities

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