Homework Answers
You should invest in the treasury bill which you can rollover every 6 months and reinvest rather than investing in a treasury with 9 years to maturity.
As the interest will in future, you will be able to earn higher interest if you rollover but you would have earn same 5% throughout 9 year if you would have bought bond with 9 years maturity.
Also, price fluctuation and risk is more for a long term bond than a short term bond. Hence, you should go for short term bond and rollover after every 6 month.
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