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Not sure how to put this into financial calculator 2. Suppose that the current one-year (one-year spot rate) and expected one-year T-bill rates over the

image text in transcribedNot sure how to put this into financial calculator

2. Suppose that the current one-year (one-year spot rate) and expected one-year T-bill rates over the following three years (i.e. 2, 3, and 4, respectively are as follows: D1R1 = 6.00% E[2r1] = 7.00% E[3r1] = 7.50% E[4/1] = 7.85% a. Using the unbiased expectations theory, calculate the current (long-term) rates for one-, two-, three-, and four-year-maturity Treasury securities (8 pts). D1R1 = 6.00% D_R2 = [(1 + 0.06)(1 + 0.07)]} 1 = 0.065 = 6.5% D1R3 = [(1 + 0.06)(1 + 0.07)(1 + 0.075)]3 1 = 0.0683 = 6.83% D1R4 = [(1 + 0.06)(1+0.07)(1 + 0.075)(1+0.0785)] 1 = 0.0709 = 7.09%

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