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It will great to have some assistance. 1. Suppose that people expect the one-year interest rate will equal 1% forever. a. Consider a ten-year zero

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It will great to have some assistance.

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1. Suppose that people expect the one-year interest rate will equal 1% forever. a. Consider a ten-year zero coupon [discount] bond with a face value of $1000. The bond has a current price of 5910. Is the term premium positive or negative? b. Redo question (a), assuming that the bond has a current price of 5900. c. Using FRED, plot the behavior of the term premium on a 10-year zero coupon bond over the past 25 years in the U5

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