Question
If you have 1-year rate is 8%, 2-year rate is 9%, and 3-year rate is 10%. Assume that the pure expectations theory for the term
If you have 1-year rate is 8%, 2-year rate is 9%, and 3-year rate is 10%. Assume that the pure expectations theory for the term structure of interest rates holds, no liquidity or maturity premium exists.
What is implied 1 year rate 2 year from now?
Group of answer choices
9%
10%
11%
12%
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Foundations In Personal Finance
Authors: Dave Ramsey
1st Edition
0981683967, 978-0981683966
