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Can you please provide the explanation, formula and correct answer for the problem above? Suppose you observe the following interest rates from the yield curve:

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Can you please provide the explanation, formula and correct answer for the problem above?

Suppose you observe the following interest rates from the yield curve: 1-year Treasury note: 4% 5-year Treasury note: 10% These rates imply the interest rate, X, on the 4-year Treasury notes 1 year from now. What is X ? Select one: a. 12.12% C b. 11.55% 0 c. 9.82% C d. 10.87%

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