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The Paper-Bill Spread Refers to the Interest Rate Spread Between

Question 122

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The paper-bill spread refers to the interest rate spread between commercial paper and Treasury bills with the same maturity. Is this a risk spread or a term spread? How do you expect the paper-bill spread is related to GDP growth? What is the intuition for this result? What does this imply about the yield curve?

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This is a risk spread because it compare...

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