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Recall that on a one-year Treasury security the yield is 5.1500% and 7.7250% on a two-year Treasury security. Suppose the one-year security does not have
Recall that on a one-year Treasury security the yield is 5.1500% and 7.7250% on a two-year Treasury security. Suppose the one-year security does not have a maturity risk premium, but the two-year security does and it is 0.35%. What is the markets estimate of the one-year Treasury rate one year from now? (Note: Do not round your intermediate calculations.) 10.9977% 9.6471% 12.2518% 8.2%
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