T-bills are an important money market instrument. In addition, you should recall that the T-bill yield represents the nominal short-term risk-free rate. But like all interest rates, the market rate of interest that Treasury bills pay changes over time.
1a) What are T-bills currently yielding? 1b) What is the current (annual) rate of inflation? Cite your source(s).
2a) What were T-bill yields in 1980? 2b) What was inflation in 1980? Cite your source(s).
3) Do you see a relationship between T-bill rates and inflation?