Question

What is the typical relationship between interest rates on​ 6-month treasury​ bills, 10-year treasury​ notes, and baa corporate​ bonds?

a. they tend to move together over time with the corporate bond having the highest rate of interest
b. they tend to move randomly and independent of each other
c. they tend to move together over time with the​ 6-month treasury bill having the highest rate of interest
d. all three rates are virtually exact representations of the rate of inflation?

Answer 1

What is the typical relationship between interest rates on​ 6-month treasury​ bills, 10-year treasury​ notes, and baa corporate​ bonds? They tend to move together over time with the corporate bond having the highest rate of interest. A treasury note is issued by the US treasury as currency. A treasury bill is a short-dated government security with no interested by is given discounted. A Baa corporate bond is a medium-grade obligations and are considered investment eligible.