Question: Go to http://ecos.bok.or.kr/ in folder 4.1.2 and plot yield rates (yields to maturity) on 1-year Treasury (Ministry of Finance) bonds, 3-year Treasury bonds, 5-year Treasury

Go to http://ecos.bok.or.kr/ in folder 4.1.2 and plot yield rates (yields to maturity) on 1-year Treasury (Ministry of Finance) bonds, 3-year Treasury bonds, 5-year Treasury bonds, 10-year Treasury bonds and 20-year Treasury bonds from 2006 to the latest month.

http://ecos.bok.or.kr/ NOTETihs web is the bank of Korea and it will show korean after you get in. Please seclect ENGLISH to transform the language. Thank you.)

Which bond has the highest average yield rate? Why do you think this is true?

In a later chapter, we consider how to calculate the standard deviation to measure risk or volatility. Calculate the standard deviation in a spreadsheet for the yield rate of each bond (in MS Excel use formula =STD()). Which yield rate has the highest standard deviation, or the most volatile yield rates, from 2006?

Is your result measuring the deviation of yield rates with the predictions in Table 1 in the text (.docx) file, where long term bonds have more deviation/volatility?

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