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Suppose we observe the following rates: 1R1=10%, 1R2=14%, and E(r2)=8%.if the liquidity premium theory of the term structure of interest rates holds, what is the
Suppose we observe the following rates: 1R1=10%, 1R2=14%, and E(r2)=8%.if the liquidity premium theory of the term structure of interest rates holds, what is the liquidity premium for year 2?
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