nswer this question. Feel free to bring in graphs or data into your analysis. Your essay should be detailed enough to provide analysis for all three periods (a paragraph is not sufficient to answer this question). Please limit yours answers to no more than 2 typewritten double spaced pages (not including graphs or tables). (18 points) From the end of 2009 to the end of 2019, the size of the United States National Debt held by the public grew from $6.8 trillion to $17.2 trillion, which meant that the supply of government bonds rose substantially over the period. During the same period, however, the 10 year US Treasury Bond yield to maturity fell from 3.59% in December 2009 to 1.86% in December of 2019. Explain how such an increase in the supply of government bonds can lead to a fall in the interest rate. Second, consider the graph above. From, January 2020 to the end of March 2020, the 10 year bond rate decreased from over 1.8% to 0.6% in 2020, despite a further increase in the national debt ($20.5 trillion as of June 30, 2020). Why did the beginning of the COVID crisis lead to such a fall in this interest rate? Finally, since August 4, 2020, the yield has risen from 0.52% to 1.8% as of Thursday, January 27, 2122, Why has the 10 year bond yield been rising since August, 2122? I am looking for analysis on each of these subperiods that is consistent with the theories we learned from chapters 5 and 6
Answer this question. Feel free to bring in graphs or data into your analysis. Your essay
should be detailed enough to provide analysis for all three periods (a paragraph is not
sufficient to answer this question). Please limit yours answers to no more than 2
typewritten double spaced pages (not including graphs or tables). (18 points)
From the end of 2009 to the end of 2019, the size of the United States National Debt held by the
public grew from $6.8 trillion to $17.2 trillion, which meant that the supply of government bonds
rose substantially over the period. During the same period, however, the 10 year US Treasury
Bond yield to maturity fell from 3.59% in December 2009 to 1.86% in December of 2019.
Explain how such an increase in the supply of government bonds can lead to a fall in the interest
rate.
Second, consider the graph above. From, January 2020 to the end of March 2020, the 10 year
bond rate decreased from over 1.8% to 0.6% in 2020, despite a further increase in the national
debt ($20.5 trillion as of June 30, 2020). Why did the beginning of the COVID crisis lead to
such a fall in this interest rate? Finally, since August 4, 2020, the yield has risen from 0.52% to
1.8% as of Thursday, January 27, 2122, Why has the 10 year bond yield been rising since
August, 2122? I am looking for analysis on each of these subperiods that is consistent with the
theories we learned from chapters 5 and 6
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