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The CFO of your firm has asked you for an approximate answer to this question: What was the increase in real purchasing power associated with
The CFO of your firm has asked you for an approximate answer to this question: What was the increase in real purchasing power associated with both 3-month Treasury bills and 30-year Treasury bonds? Assume tha the current 3-month Treasury bill rate is 4.34%, the 30 year Treasury bond rate is 7.33 percent, and the inflaion rateis 2.78%. Also, the chief financial officer wants a short explanation should the 3-month real rate turn out to be less than the 30-year real rate.
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