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The interest rates on 3- and 2-year Treasuries are 2.35% and 2.20%, respectively. If you estimate that the 1-year expected spot rate in year 3

The interest rates on 3- and 2-year Treasuries are 2.35% and 2.20%, respectively. If you estimate that the 1-year expected spot rate in year 3 is 2.53%, what is the liquidity premium on the 3 -year Treasuries based on the liquidity preference theory? A. 0.12% B. 0.04% C. 0.08% D. 0.19%

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