Question: Question 1 Describe the difference between term structure of interest rates and risk structure of interest rate. Question 2 a. Using the following data

Question 1 Describe the difference between term structure of interest rates and

Question 1 Describe the difference between term structure of interest rates and risk structure of interest rate. Question 2 a. Using the following data develop the yield curve. Time to maturity 9month tbill 5 year T-notes 12 year T-bond 15 year t-bond 25 year t-bond Yield to maturity % 3 7 8.5 9 11 b. What does upward and downward sloping yield curves indicate about the future economic activities?

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