Assume That Interest Rates on 20-Year Treasury and Corporate Bonds $\text { T-bond } = 7.72 \% \quad \text { AAA } = 8.72 \% \quad \text { A } = 9.64 \% \quad \text { BBB } = 10.18 \%$

question 14

Multiple Choice

Assume that interest rates on 20-year Treasury and corporate bonds are as follows:
$\text { T-bond } = 7.72 \% \quad \text { AAA } = 8.72 \% \quad \text { A } = 9.64 \% \quad \text { BBB } = 10.18 \%$
The differences in these rates were probably caused primarily by:

• A) Tax effects.
• B) Default and liquidity risk differences.
• C) Maturity risk differences.
• D) Inflation differences.
• E) Real risk-free rate differences.

---

Definitions:

Land Surface

Land surface refers to the solid portion of the Earth's surface that is not covered by water, including everything from mountains and valleys to plains and beaches.

Isostatic Rebound

The rise of land masses after the removal of the weight of ice sheets or glaciers, a process of Earth’s crust returning to its equilibrium position over geological time scales.

West Antarctica

The portion of Antarctica that lies west of the Transantarctic Mountains, known for its ice sheets and dynamic glacial activity.

Global Sea Levels

Refers to the average height of the ocean's surface between the high and low tide, which has been rising due to climate change.