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5. The real risk-free rate of interest is 2%. Inflation is expected to be 3.5% the next 2 years and 6% during the next 3

image text in transcribed5. The real risk-free rate of interest is 2%. Inflation is expected to be 3.5% the next 2 years and 6% during the next 3 years after that. Assume that the maturity risk premium is zero. What is the yield on 3-year Treasury securities? What is the yield on 5-year Treasury securities?

5. The real risk-free rate of interest is 2%. Inflation is expected to be 3.5% the next 2 years and 6% during the next 3 years after that. Assume that the maturity risk premium is zero. What is the yield on 3-year Treasury securities? What is the yield on 5-year Treasury securities

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