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MET AD632 Financial Concept

Non-CONNECT Assignment #4 - Yield Curve Exercise

Part 1 – Enter Required Data Below

Current Yield (%) Yield One Year Ago (%)

1-Month Bill

3-Month Bill

6-Month Bill

1-Year Note

2-Year Note

3-Year Note

5-Year Note

7-Year Note

10-Year Note 30-Year Bond

NOTE: In order to get the data and information, please enter and go to https://www.wsj.com and select Markets & Finance, then Bonds & Rates.

Part 2 – Draw the Yield Curve

Use the Part 1 data to draw (please display both curves on the same chart and do not use/paste the chart from other sources into your submission file)

a. The Current yield curve from 1-Month T-Bill to 30-Year T- Bond

b. The 1 Year Ago yield curve from 1-Month T-Bill to 30-year T-Bond

Part 3 – Answer the Following Questions

Using the CURRENT Yield Curve from Part 2 answer the following questions:

a. Indicate which part, if any, of the Current Yield Curve is

1) “Upwardly sloping”?

2) “Downwardly sloping”? and

3) “Flat”?

b. Explain what these three types of slopes usually/could mean to the economy?