Question
A 2-year Treasury security currently earns 1.79 percent. Over the next two years, the real risk-free rate is expected to be 1.00 percent per year
A 2-year Treasury security currently earns 1.79 percent. Over the next two years, the real risk-free rate is expected to be 1.00 percent per year and the inflation premium is expected to be 0.35 percent per year. Calculate the maturity risk premium on the 2-year Treasury security.(Round your answer to 2 decimal places.)
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Introduction To Financial Accounting
Authors: Charles T Horngren, John A Elliott
9th Edition
0131479725, 978-0131479722
