You are given the following data:
Assume that a highly liquid market does not exist for long-term T-bonds, and the expected rate of inflation is a constant.Given these conditions, the nominal risk-free rate for T-bills is __________, and the rate on long-term Treasury bonds is __________.
A) 4%; 14%
B) 4%; 15%
C) 11%; 14%
D) 11%; 15%
E) 11%; 17%
Correct Answer:
Verified
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