Lower coupon rates than corporate bonds

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Reference no: EM13836564

Treasury bonds typically have lower coupon rates than corporate bonds because

The U.S. Treasury does not earn profits.

There is a lower risk that the U.S. Treasury will default.

Government regulations keep interest rates on Treasury bonds below market rates.

The opportunity cost of purchasing Treasury bonds is lower than the opportunity cost of buying corporate bonds.

Reference no: EM13836564

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