Why do you think the yields differ

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Question 1: Compare the yield offered on three-month T-bill and another money market security (e.g., commercial paper) with a similar maturity. What is the difference in yield? Why do you think the yields differ?

Question 2: Retrieve interest rate data at the beginning of the last 20 quarters for the three-month Tbill and another money market security with 3-month maturity. Place the data in two columns of an Excel spreadsheet. Derive the change in interest rates for both money market securities on a quarterly basis. Apply regression analysis in which the quarterly change in the interest rate of the risky money market security is the dependent variable and the quarterly change in the T-bill rate is the independent variable. Is there a positive and significant relationship between the interest rate movements? Explain

Reference no: EM133641190

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