Financial Markets and Institutions (2-downloads)

www.federalreserve.gov/releases/h15

(historical data) and find the interest-rate listings for

AAA- and Baa-rated bonds at three points in time: the

most recent; June 1, 1995; and June 1, 1992. Prepare

a graph that shows these three time periods (see

Figure 5.1 for an example). Are the risk premiums

stable or do they change over time?

2. Figure 5.7 shows a number of yield curves at various

points in time. Go to 

www.bloomberg.com

, and click

on “Markets” at the top of the page. Find the Treasury

yield curve. Does the current yield curve fall above or

below the most recent one listed in Figure 5.7? Is the

current yield curve flatter or steeper than the most

recent one reported in Figure 5.7?

3. Investment companies attempt to explain to

investors the nature of the risk the investor incurs

when buying shares in their mutual funds. For exam-

ple, go to