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Why Were Interest Rates on U

Question 11

Multiple Choice

Why were interest rates on U.S. Treasury securities in 1998 at their lowest levels in a generation?


A) Investors were fearful of a revival of inflation.
B) A severe recession in the United States resulted in investors shifting out of corporate bonds and into U.S. Treasury securities.
C) A cut in tax rates reduced the desirability of municipal bonds, leading investors to shift into U.S. Treasury securities.
D) A crisis in Asian financial markets resulted in a flight to quality.

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