Problem
1. What uncertainty is involved in the purchase of a U.S. government bond, assuming nö risk of default in bond payments? Is it possible to realize economic profit from the purchase and sale of these bonds? If so, how?
2. What are the two main reasons for a positive interest rate, even when neither risk nor inflation is present? From the self-interested viewpoint of a future generation, is either reason a good one to use in rationing loanable funds among existing investment opportunities? Explain.
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.