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Assume that the Liquidity Preference Theory of the Term Structure is correct and that you would require an additional maturity risk premium of . 6

Assume that the Liquidity Preference Theory of the Term Structure is correct and that you would require an additional maturity risk premium of .65% to invest for a 5- year period . On the other hand , if you invest in a series of five ,1- year securities you will require no liquidity premium . How much more will you end with if you invest $ 3,000 in a 5- year security rather than a series of five ,1- year securities ? Year K Avg K 111.00% Avg IP 3.0% KN 3.0% K 2%4.00%4.0%31%3.0%4.00%4.0%421.00%1.00%1.25%1.40%3.0%3.6%4.4%6.0%3.2%4.20%4.6%53.5%2%4.755.40%6.4%4.0%8.0% Answer in dollars and cents , truncated to the nearest fent . Do not enter a " $ " For example if your answer is $ 1,234.567, enter "1234.56" Canvas will display this as "1,234.56"

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