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Q: Why are yields on treasury bonds lower than on coporate bonds?
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How does the fed purchase of bonds lower yields?

Yes, it generally raises prices and lowers yields


How can Treasury bonds can have an effect on the size of the money supply?

The Federal Reserve Bank can buy and sell Treasury bonds to raise or lower bank deposits


Which websites carry information on ETF Treasury bonds?

Treasuries are debt obligations issued and backed by the full faith and credit of the U.S. government. Because they are considered to have low credit or default risk, they generally offer lower yields relative to other bonds.


Why do treasury bonds carry a lower interest rate than those other issuers such as corporations and municipalities?

Because Treasuries are backed by the U.S. govt, and by extension the U.S. economy and society as a whole. This is perceived as safer than individual corporate bonds, and therefore the yields don't need to be as high.


What best explains why treasury bonds have an effect on the size of the money supply?

The Federal Reserve Bank can buy and sell these bonds to raise or lower bank deposits.


What do I need to know about high yield investments?

Yes, high yield investments which are also called junk bonds, are quite risky and that is why they pay higher yields. Safer investments will have lower yields, and include AAA and AA rated corporate bonds, government bonds, as well as Certificates of Deposit (CDs) among others.


What of the following best explains why treasury bonds have an effect on the size of the money supply?

The Federal Reserve Bank can buy and sell these bonds to raise or lower bank deposits. APEX


What effect will the feds sells 5 billion worth of treasury bonds on the open market have on the money supply?

The Federal Reserve Bank can buy and sell these bonds to raise or lower bank deposits.


What of the best following best explains why treasury bonds have an effect on the size of the money supply?

The Federal Reserve Bank can buy and sell these bonds to raise or lower bank deposits. APEX


Do bonds with quarterly coupons have lower yields than those with semi-annual coupons?

Yields on bonds are independent of the frequency of coupon payment. The most used by professionals yield to worst (maturity or call date) depends only on the perceived riskiness of the bond and the supply and demand conditions for the bond.


What best explains why the money supply increased when the fed buys treasury bonds?

When the Fed buys Treasury bonds, it increases the amount of deposits in people's bank accounts. The purchase of bonds increases the amount of deposits in people's bank accounts, which enables banks to loan more money


What does it mean by contract the money supply?

It means to decrease, or lower, the money supply. EXAMPLE: The feds sold treasury bonds and bills in order to contract (decrease) money supply.