Question
Rates & Bonds 10 Year Government Bond Yields Country Yield United States 0.68 % Canada 0.76 % Mexico 7.3 0% Switzerland -0.38% a) Assuming that
Rates & Bonds
| 10 Year Government Bond Yields
Country | Yield | |||||||||
|
United States |
0.68 % | |||||||||
| Canada | 0.76 % | |||||||||
| Mexico | 7.3 0% | |||||||||
| Switzerland | -0.38% | |||||||||
a) Assuming that bond rating agencies, such as Moodys and Standard & Poors, have rated the government bonds of the US, Canada, Switzerland, and Germany free of risk of default-with a grade of AAA - how do you explain the apparent differences between, the US bond rate on the one hand and the Swiss bond rate and the Canadian bond on the other hand? Explain the theory behind this.
(b) How do you explain the apparent difference between the US bond rate and that of Mexicos if Mexican Bonds are ranked riskier than that of the US?
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Cases in Financial Reporting
Authors: Michael J. Sandretto
1st edition
538476796, 978-0538476799
