The Following Monthly Data of Yields on Five-Year Treasury Bonds

question 66

Multiple Choice

The following monthly data of yields on five-year Treasury bonds comes from the Reserve Bank Bulletin:
$$\begin{array} { | l | l | l | l | l | } \hline 20 \mathrm { xx } / \mathrm { xx } & \text { Jul. } & 7.65 \% & \text { Jan. } & 7.30 \% \\\hline & \text { Aug. } & 7.75 \% & \text { Feb. } & 7.15 \% \\\hline & \text { Sep. } & 7.80 \% & \text { Mar. } & 6.91 \% \\\hline & \text { Oct. } & 7.90 \% & \text { Apr. } & 6.80 \% \\\hline & \text { Nov. } & 7.75 \% & \text { May } & 6.65 \% \\\hline & \text { Dec. } & 7.50 \% & \text { Jun. } & 6.55 \% \\\hline\end{array}$$
What type of yield curve is indicated by the above data set?

• A) Normal yield curve
• B) Inverse yield curve
• C) Humped yield curve
• D) Variable yield curve

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