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Liquidity Premium Hypothesis One-year Treasury bills currently earn 4.95 percent. You expect that one year from now, one-year Treasury bill rates will increase to 5.10

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Liquidity Premium Hypothesis One-year Treasury bills currently earn 4.95 percent. You expect that one year from now, one-year Treasury bill rates will increase to 5.10 percent. The liquidity premium on two-year securitics is 130 percent. If the liquidity theory is cortect, what should the current rate be on two-year Treasury securities? Multipie Choice 5.0250% 5.0900% 3,3930%

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