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Interest Rate DifferentialsThe Default Risk Premium at a Certain Point

Question 10

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Interest rate differentialsThe default risk premium at a certain point in time may be expressed by comparing the interest rates on:


A) a Treasury bill and a Treasury bond
B) a Treasury bill and a long-term corporate bond
C) a Treasury bill and the commercial paper rate
D) a risky security and a comparable maturity U.S.Treasury security

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