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Please show work 1. Recall that on a one-year treasury security the yield is 5.84% and 7.01% on a two-year treasury security. Suppose the one-

Please show work

1. Recall that on a one-year treasury security the yield is 5.84% and 7.01% on a two-year treasury security. Suppose the one- year security does not have a maturity risk presium, but the two-year security does and it is .2%. What is the market's estimate of the one-year treasury rate one year from now?

options- 9.893%, 7.79%, 8.881%, 6.622%

2. Suppose the yield on a two-year treasury security is 5.83% and the yield on a five-year treasury security is 6.20%. Assuming that the pure expectations theory is correct, what is the market's estimate of the three-year treasury rate two years from now?

options- 6.53%, 6.45%, 6.69%, 7.10%

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