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D Question 5 1 pts Currently, 3-year Treasury securities yield 3.2%, 7-year Treasury securities yield 3.7%, and 10-year Treasury securities yield 4%. If the expectations
D Question 5 1 pts Currently, 3-year Treasury securities yield 3.2%, 7-year Treasury securities yield 3.7%, and 10-year Treasury securities yield 4%. If the expectations theory is correct, what does the market expect will be the yield on 7-year Treasury securities three years from today? 4.50% 4.17% 4.25% 4.00% 4.34% D Question 6 1 pts The real risk-free rate of interest is 3 percent. Inflation is expected to be 2 percent this coming year, jump to 3 percent next year, and increase to 4 percent the year after (Year 3). According to the expectations theory, what should be the interest rate on 2-year, risk-free securities today? 5.50% 5.60% 5.70% 5.80% 5.90%
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