Question: Assume that the Treasury experiences a large decrease in the budget deficit and purchases a large number of short-term Treasury securities (Treasury bills or T-bills).

 Assume that the Treasury experiences a large decrease in the budget

Assume that the Treasury experiences a large decrease in the budget deficit and purchases a large number of short-term Treasury securities (Treasury bills or T-bills). This action will the supply of T-bills in the market and place. pressure on the yield of T-bills. decrease; downward decrease; upward increase; upward increase; downward Question 20 0.25pts Other things being equal, the yield required on A-rated bonds should be the yield required on B-rated bonds whose other characteristics are exactly the same. greater than equal to less than All of these are possible, depending on the size of the bond offering

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