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Based on economists' forecasts and analysis, 1-year Treasury bill rates and liquidity premiums for the next four years are expected to be as follows R1

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Based on economists' forecasts and analysis, 1-year Treasury bill rates and liquidity premiums for the next four years are expected to be as follows R1 E(21) E(311) E(41) 2.28% 3. 10x 3.50% 3.95% 12 L3 14 0.06% 0.08% 0.13% Using the liquidity premium theory, determine the current (longterm) rates. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Years Current (Long- Term) Rates 2 201% 1 2 3 4

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