Figure 232

Changes in Five-Year Treasury Bond Rates: 1960-97

Source: Charles W. Smithson, Managing Financial Risk: A Guide to Derivative Products, Financial Engineering, and Value Maximization, 3rd ed. (New York: The McGraw-Hill Companies, 1998).

unexpected changes in overall price levels, there are three specific areas of particular importance to businesses in which volatility has also increased dramatically: interest rates, exchange rates, and commodity prices.

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