Look at Table 12.1 and Figure 12.7 in the text. When were T-bill rates at their highest over the period from 1926 through 2019? Why do you think they were so high during this period? What relationship underlies your answer?

Table 12.1

Figure 12.7

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TABLE 12.1 Year-to-Year Total Returns: 1926-2019 Year Large-Company Stocks Long-Term Government Bonds U.S. Treasury Bills Consumer Price Index 1926 11.62% 7.77% 3.27% -1.49% 1927 37.49 8.93 3.12 -2.08 1928 43.61 .10 3.56 -.97 1929 -8.42 3.42 4.75 .20 1930 -24.90 4.66 2.41 -6.03 1931 -43.34 -5.31 1.07 -9.52 1932 -8.19 16.84 .96 -10.30 1933 53.99 -07 .30 .51 1934 -1.44 10.03 .16 2.03 1935 47.67 4.98 .17 2.99 1936 33.92 7.52 .18 1.21 1937 -35.03 .23 .31 3.10 1938 31.12 5.53 -.02 -2.78 1939 -41 5.94 .02 -48 1940 -9.78 6.09 .00 .96 1941 -11.59 .93 .06 9.72 1942 20.34 3.22 .27 9.29 1943 25.90 2.08 .35 3.16 1944 19.75 2.81 .33 2.11 1945 36.44 10.73 .33 2.25 1946 -8.07 -.10 .35 18.16 1947 5.71 -2.62 .50 9.01 1948 5.50 3.40 .81 2.71 1949 18.79 6.45 1.10 -1.80 1950 31.71 .06 1.20 5.79 1951 24.02 -3.93 1.49 5.87 1952 18.37 1.16 1.66 .88 1953 -.99 3.64 1.82 .62 1954 52.62 7.19 .86 -.50 1955 31.56 -1.29 1.57 .37 1956 6.56 -5.59 2.46 2.86 1957 - 10.78 7.46 3.14 3.02 1958 43.36 -6.09 1.54 1.76 1959 11.96 -2.26 2.95 1.50 1960 47 13.78 2.66 1.48 1961 26.89 .97 2.13 .67 1962 -8.73 6.89 2.73 1.22 1963 22.80 1.21 3.12 1.65 1964 16.48 3.51 3.54 1.19 1965 12.45 .71 3.93 1.92 1966 -10.06 3.65 4.76 3.35 1967 23.98 -9.18 4.21 3.04 1968 11.06 -.26 5.21 4.72 1969 -8.50 -5.07 6.58 6.11 1970 3.86 12.11 6.52 5.49 1971 14.30 13.23 4.39 3.36 1972 19.00 5.69 3.84 3.41 1973 -14.69 -1.11 6.93 8.80