Yield Curve
What is a yield curve, and what information would you need to draw this curve?
Distinguish among the shapes of a “normal” yield curve, an “abnormal” curve, and a “humped” curve.
If the interest rates on 1-, 5-, 10-, and 30-year bonds are 4, 5, 6, and 7 percent, respectively, how would you describe the yield curve? If the rates were reversed, how would you describe it?
What is a yield curve, and what information would you need to draw this curve? Distinguish among the shapes of a “normal” yield curve, an “abnormal” curve, and a “humped” curve.
