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Question
The interest rates on government agency bonds areA)almost identical to those available on Treasury securities since it is unlikely that the federal government would permit its agencies to default on their obligations.
B)significantly higher than those available on Treasury securities due to their low liquidity.
C)significantly lower than those available on Treasury securities because agency interest payments are tax exempt.
D)significantly lower than those available on Treasury securities because the interest-rate risk on agency securities is lower than that on Treasury securities.
Answer
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