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any work that could be shown would be nice. thank you 7, (5 points) Suppose the interest rate on a 1-year T-bond is 5.00% and

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any work that could be shown would be nice. thank you

7, (5 points) Suppose the interest rate on a 1-year T-bond is 5.00% and that on a 2-year T- bond is 4.10%. Assume that the pure expectations theory is NOT valid, and the MRP is zero for a 1-year T-bond but 0.40% for a 2-year bond, what is the yield on a 1-year T-bond expected to be one year from now? Round the intermediate calculations to 4 decimal places. (Show your work)

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