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please help with 19 and 20, will give u a thumbs up:) Which of the following statements is CORRECT? The yield on a 3-year Treasury
please help with 19 and 20, will give u a thumbs up:)
Which of the following statements is CORRECT? The yield on a 3-year Treasury bond cannot exceed the yield on a 10-year Treasury bond. The yield on a 2-year corporate bond should always exceed the yield on a 2-year Treasury bond. The yield on a 3-year corporate bond should always exceed the yield on a 2-year corporate bond. The yield on a 10-year AAA-rated corporate bond should always exceed the yield on a 5-year AAA-rated corporate bond. The following represents a "possibly reasonable" formula for the maturity risk premium on bonds: MRP= 0.1%(t), where t is the years to maturity. Question 20 (5 points) Which of the following statements is CORRECT? The yield on a 2-year corporate bond should always exceed the yield on a 2-year Treasury bond. The yield on a 3-year corporate bond should always exceed the yield on a 2-year corporate bond. The yield on a 3-year Treasury bond should always exceed the yield on a 2-year Treasury bond. If inflation is expected to increase, then the yield on a 2-year bond should exceed that on a 3-year bond. The real risk-free rate should increase if people expect inflation to increaseStep by Step Solution
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