The Federal Reserve Bank of
St. Louis offers a wide range of economic data at
its Web site, called FRED (research.stlouisfed.
org/fred2/). Find the data for U.S. three-month
and one-year Treasury bill rates from 1990 to the
most recent date available and download these
data into an Excel file.
a. What is the average interest rate on each type
of Treasury bill over this period?
b. What is the standard deviation? Which series
is more volatile?
c. Graph the data. Do the rates move together?
d. Calculate the mean and standard deviation
again, but end the series at 2006 rather than
the current date. How does this change the
mean and standard deviation? Briefly explain.