Yield Difference in Treasury Securities of Varied Maturities May Be

question 63

Multiple Choice

Yield difference in Treasury securities of varied maturities may be explained by

• A) marketability.
• B) default risk.
• C) expectations of future inflation.
• D) all of the above
• E) none of the above
• Use the following interest rate data to answer the next five questions:
• Treasury Bills, 90 days 4.20%
• Commercial Paper, 90 days 4.84%
• Treasury Bill, 1 year 4.67%
• Treasury Note, 2 year 5.25%
• Corporate Bond AA, 20 year 8.23%
• Municipal Bond AA, 20 year 6.42%
• Expected Annual Inflation Rate 3.00%

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Definitions:

Test-Retest Reliability

A measure of consistency where the same test administered to the same group of individuals at two different points in time produces similar results.

Normal Distribution

A bell-shaped frequency distribution where most occurrences take place near the mean and fewer occur as the distance from the mean increases.

Criterion-Referenced Testing

involves evaluating and scoring a test taker's performance based on a specific set of criteria or standards, rather than comparing it to the performance of a peer group.

No Child Left Behind

A U.S. Act aimed at closing the achievement gap with accountability, flexibility, and choice, so that no child is left behind.