Explain development using risk structure of interest rates


In 1993, President Clinton and Congress raised tax rates on high income households. As a result, the yield spread between Treasuries and munis became larger (in other words, the differences between Treasury yields and muni yields increased). Explain this development using the Risk Structure of Interest Rates. Use a bond market diagram to illustrate your answer.

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Microeconomics: Explain development using risk structure of interest rates
Reference No:- TGS068323

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