1.A government bond fund buys a mix of 3-month treasury bills with a stated rate of 6% and a variety of treasury bonds with semiannual coupons. The firm is analyzing the implications if stated yield rates on the treasury bonds increase or decrease by 100 basis points. What rate should be used on the treasury bill for consistency

Answer rating: 100% (QA)

Adjusting the rate on the treasury bill by the same amount as the yield rates on the treasury bonds ... View the full answer