Macroeconomics 1st Edition by Dean Karlan,Jonathan Morduch

Exercise 1

The interest rate on 10-year U.S. Treasury bonds just before Standard and Poor's downgraded the U.S. credit rating was 2.47 percent. One year later, the interest rate on these bonds had fallen to 1.60 percent. How can one explain this result that seems to contradict the findings of this chapter?