Question 1: The following graph shows the real US yield curve on January 12, 2021, and February 26 , 2020. Given the latest yield curve of January 12, 2021, what is your predictron of the future interest rates in the US? (%) Yield curve on Jan. 12, 2021 on Feb. 26, 2020 Yield currve 2.00 1.80 1.60 1.40 1.20 1.00 0.80 O.60 OL40 0.20 1 Mo 2 Mo 3 Mo 6 Mo 1 Yr 2 Yr 3 Yr 5 Yr 10Yr 20 Yr 30 Yr

International Financial Management
14th Edition
ISBN:9780357130698
Author:Madura
Publisher:Madura
Chapter8: Relationships Among Inflation, Interest Rates, And Exchange Rates
Section: Chapter Questions
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Question 1: The following graph shows the real US yield curve on January 12, 2021, and February
26, 2020. Given the latest yield curve of January 12, 2021, what is your prediction of the future
interest rates in the US?
(%)
Yield curve on Jan. 12, 2021
Yield curve on Feb. 26, 2020
2.00
1.80
1.60
1.40
1.20
1.00
0.80
O.60
0.40
D.20
0.00
1 Mo 2 Mo 3 Mo 6 Mo
1 Yr
2 Yr
2 Yr 5 Yr Z Y 10 Yr 20 yn 30 Yr
Transcribed Image Text:Question 1: The following graph shows the real US yield curve on January 12, 2021, and February 26, 2020. Given the latest yield curve of January 12, 2021, what is your prediction of the future interest rates in the US? (%) Yield curve on Jan. 12, 2021 Yield curve on Feb. 26, 2020 2.00 1.80 1.60 1.40 1.20 1.00 0.80 O.60 0.40 D.20 0.00 1 Mo 2 Mo 3 Mo 6 Mo 1 Yr 2 Yr 2 Yr 5 Yr Z Y 10 Yr 20 yn 30 Yr
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