Question
Chapter 6 question 3 One-year Treasury bills currently earn 3.65 percent. You expect that one year from now, 1-year Treasury bill rates will increase to
Chapter 6 question 3
One-year Treasury bills currently earn 3.65 percent. You expect that one year from now, 1-year Treasury bill rates will increase to 3.85 percent. The liquidity premium on 2-year securities is 0.06 percent. If the liquidity theory is correct, what should the current rate be on 2-year Treasury securities? (Round your answer to 2 decimal places.)
| Current rate | % |
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Options Futures And Other Derivatives
Authors: John C. Hull
4th Edition
0130224448, 9780130224446
