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U.S. Treasury bills Question 18 Assume that you observe the following rates on long-term bonds: U.S. Treasury bonds 4.15 percent AAA Corporate bonds 6.2 percent

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U.S. Treasury bills Question 18 Assume that you observe the following rates on long-term bonds: U.S. Treasury bonds 4.15 percent AAA Corporate bonds 6.2 percent BBB Corporate bonds 7.15 percent The main reason for the differences in the interest rates is: e Convertibility premium O Default risk premium Maturity risk premium O Inflation premium Question 19

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