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Assume that the real risk-free rate is r*=3% and that the average expected inflation rate is 2.5% for the foreseeable future. The applicable MRP is

Assume that the real risk-free rate is r*=3% and that the average expected inflation rate is 2.5% for the foreseeable future. The applicable MRP is 2% for a 20 year bond. What is the yield on a 20 year T-bond ( which is default free and trades in a very active market?

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