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Short term (one year) interest years over the next 6 years will be 1.8, 1.4, 2, 1.5, 3.1, and 1.5. Assume that the investors prefer

Short term (one year) interest years over the next 6 years will be 1.8, 1.4, 2, 1.5, 3.1, and 1.5. Assume that the investors prefer holding short-term bonds so that liquidity premium of 10 basis points is required for each year of bond maturity. Using the liquidity premium theory, what will be the interest rates on 5-year bonds?

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