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10. The real risk-free rate of interest is 3 percent. Assume an investor expects inflation to be 4% next year, 5% the following year and
10. The real risk-free rate of interest is 3 percent. Assume an investor expects inflation to be 4% next year, 5% the following year and 6% per year thereafter. In addition, assuming that the MRP is zero for Year 1 and increases by 0.2% each year, what will be the market interest rate for the following treasury securities: 1 year T-bill, 5 year Treasury Bond, 10 year Treasury Bond and 20 year Treasury Bond
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