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1. 2. The real risk-free rate is 3.5% and inflation is expected to be 2.75% for the next 2 years. A 2-year Treasury security yields

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The real risk-free rate is 3.5% and inflation is expected to be 2.75% for the next 2 years. A 2-year Treasury security yields 7.05%. What is the maturity risk premium for the 2-year security? Round your answer to one decimal place. An investor in Treasury securities expects inflation to be 1.9% in Year 1, 2.7% in Year 2, and 3.45% each year thereafter. Assume that the real risk-free rate is 2.35% and that this rate will remain constant. Three-year Treasury securities yield 6.20%, while 5-year Treasury securities yield 7.00%. What is the difference in the maturity risk premiums (MRPs) on the two securities; that is, what is MRP5 - MRP3? Do not round intermediate calculations. Round your answer to two decimal places

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