Assume that interest rates on 20-year treasury and, Ask an Expert

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Assume that interest rates on 20-year Treasury and corporate bonds are as follows:

T-bond = 7.72%

AAA = 8.72%

A = 9.64%

BBB= 10.18%

The differences in tese rates were probably caused primarily by:

a. Tax effects.

b. Default risk differences.

c. Maturity risk differences.

d. Inflation differences.

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92074215

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