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Some characteristics of the determinants of nominal interest rates are listed as follows. Identify (determinants) and the symbols associated with each characteristic: This is the
Some characteristics of the determinants of nominal interest rates are listed as follows. Identify (determinants) and the symbols associated with each characteristic: This is the rate on short-term U.S. Treasury securities, assuming there is no inflation. This is the premium added to the equilibrium interest rate on a security that cannot be bought or sold quickly enough to prevent or minimize loss. This is the premium that reflects the risk associated with changes in interest rates for a long-term security. This is the premium added to the risk-free rate that reflects the average sustained increase in the general level of prices for goods and services expected over the security's entire life. This is the difference between the interest rate on a U.S. Treasury bond and a corporate bond of the same profile that is, the same maturity and marketability. This is the rate for a riskless security that is exposed to changes in inflation
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