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please show your work The real risk-free rate is 2.3%. The maturity risk premium is 0.1% for 1- year maturities, growing by 0.2% per year
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The real risk-free rate is 2.3%. The maturity risk premium is 0.1% for 1- year maturities, growing by 0.2% per year up to a maximum of 1.0%. The interest rate on 4-year treasuries (federal government bonds) is 6.2%, 7.3% on 8-year treasuries, and 8% on 10-year treasuries. What conclusions can be drawn about expected inflation rates over the 10- year period? Round your answers to one decimal place. a. The average inflation rate over the first 4 years: % b. The average inflation rate for years 5-8: % c. The average inflation rate in years 9 and 10: %
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