Figure 18.3 below shows bond yields on Greek and German 10-year bonds, 2010-2014. Discuss the cause for the divergence between these rates in 2008, the dramatic rise/decline in Greek/German bond yields in 2011, and what are likely reasons for Greek rates rising so sharply in 2011-2013.Figure 18.3: Greek and German 10-Year Bond Yields: 2007-2014

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The Answer of Figure 18.3 below shows bond yields on Greek and German 10-year bonds, 2010-2014. Discuss the cause for the divergence between these rates in 2008, the dramatic rise/decline in Greek/German bond yields in 2011, and what are likely reasons for Greek rates rising so sharply in 2011-2013.Figure 18.3: Greek and German 10-Year Bond Yields: 2007-2014

Figure 183 Below Shows Bond Yields on Greek and German 10-Year