The Difference Between the 30-Year Mortgage Rate and the 30-Year

question 5

Multiple Choice

The difference between the 30-year mortgage rate and the 30-year Treasury bond rate is primarily attributable to

• A)interest rate risk.
• B)reinvestment rate risk.
• C)credit risk.
• D)insurance risk.

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Definitions:

Protection

Measures or policies implemented to guard against harm or loss in a legal, financial, or security context.

Takings Clause

A provision in the Fifth Amendment of the U.S. Constitution that prohibits the government from taking private property for public use without just compensation.

Public Use

Refers to the government's authority to take private property for public purposes under the doctrine of eminent domain, provided there is just compensation.

Public Purpose

The justification for government action or policy that is intended to serve the general public or common welfare.