Over the Past 35 Years, the Prevailing Market Yield or Discount

question 82

Short Answer

Over the past 35 years, the prevailing market yield or discount rate on 90-day T-bills has ranged from a low of 0.17% in February 2010 to a high of 20.82% simple interest in August of 1981. (The period from 1979 to 1990 was a time of historically high inflation rates and interest rates.) How much more would you have paid for a $100,000 face value 90-day T-bill at the February 2010 discount rate than at the August 1981 discount rate?

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Definitions:

Negative Reinforcement

A behavioral principle where the removal of an unfavorable condition strengthens a desired behavior.

Selective Attention

The cognitive process of focusing on specific stimuli while ignoring others, influencing how information is perceived and processed.

Selective Attention

The cognitive process of focusing on certain stimuli in the environment while ignoring others.

Perception

The process by which individuals organize and interpret sensory information to give meaning to their environment.