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Suppose 1-year T-bills currently yield 7.60% and the future inflation rate is expected to be constant at 3.10% per year. What is the real risk-free

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Suppose 1-year T-bills currently yield 7.60% and the future inflation rate is expected to be constant at 3.10% per year. What is the real risk-free rate of return, r*? Disregard any cross-product terms, i.e. if averaging is required, use the arithmetic average. O : 5.35% b. 7.84% c. 7.60% d. 10.70% e. 4.50%

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