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Explain why someone would want to buy treasury bills

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Reference no: EM131950757

Problem

Currently, the interest yield on short-term Treasury Bills is near zero. Longer-term rates for mortgages are under 4%. For this discussion, explain why a bond with a longer maturity has greater interest-rate risk than a bond with a shorter maturity. Also, explain why someone would want to buy Treasury Bills rather than invest in mortgage-backed securities. Explain in terms of risk factors (maturity, liquidity, default, etc.)

This should be a minimum of 300 words.

Reference no: EM131950757

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